NIGERIA TAX ACT, 2025

The objective of this Act is to provide a unified fiscal legislation Objective
governing taxation in Nigeria.

This Act applies throughout Nigeria to any person required to comply Application
with any provision of the tax laws whether personally or on behalf of another
person.
CHAPTER 2 – TAXATION OF INCOME OF PERSONS
PART 1 – IMPOSITION OF TAX ON INCOME, PROFITS OR GAINS

Income tax shall be determined in accordance with the provisions of Imposition
this Act, and imposed on the – of tax
(a) profits or gains of any company or enterprise ;
(b) income of any individual or family; and
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(c) income arising, accruing or due to a trustee, or an estate.
Income

(1) Income, profits or gains of a person accruing in or derived from
profits or Nigeria, including –
gains
chargeable to (a) profits or gains from any trade, business, profession or vocation for
tax whatever period of time such trade or business may have been carried on;
(b) royalties, fees, rents or interests arising from a right granted for the
use, exploitation or occupation of any property;
(c) dividends, premium, charges or annuities;
(d) fees, dues, allowances, or any remuneration for services rendered;
(e) discounts or rebates;
(f) disposal of money or money instruments;
(g) income, profits or gains from disposal or lending of securities;
(h) prizes, winnings, honoraria, grants, awards, laurels, etc.;
(i) profits or gains from the disposal of property or fixed assets;
(j) profits or gains from transactions in digital or virtual assets; and
(k) any other income, profit or gain not falling within the preceding cat-
egories.
(2) Income, profits or gains of an individual, including –
(a) salaries, wages, fees, allowances, compensations, bonuses, premi-
ums, benefits or other perquisites allowed, given or granted by any person
to any employee other than payment for expenses incurred in the
performance of the duties of the employment, and from which it is not
intended that the employee should make any profit or gain; and
(b) any pension, annuity or any other similar income.
(3) Income of a family recognised under any law or custom in Nigeria as
family income in which the several interests of individual members of the
family cannot be separately determined, excluding income on inherited assets
before distribution.
(4) Income arising to a trustee of any settlement or trust, or estate or to
an executor of any estate of a deceased person.
(5) Any other income, profit or gain not falling within the preceding
categories.
(6) For the purposes of this section –
(a) interest –
(i) accrues in Nigeria where the liability to its payment falls upon a
resident of Nigeria or Nigerian permanent establishment of a non-resident
person regardless of where or in what form the interest is paid,
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(ii) includes, penal interests and any payment similar to interest, in-
come from any government or corporate securities, bonds or debentures,
premiums or prizes attaching to such securities, bonds or debentures,
discounts, fees, premium, share of profit in non-interest finance
arrangements, finance cost element in a finance lease, or foreign exchange
differences arising in relation to securities, any payment in relation to
derivatives used in hedging securities, or any other payment of similar
nature,
(iii) in respect of debts, includes return on discounted papers, income
from debt claims of every kind, whether or not secured by mortgage and
whether or not carrying a right to participate in the debtor's profits or
foreign exchange differences arising in relation to a debt, and
(iv) in respect of regulated securities lending transactions, includes
compensating payments received by a borrower from its approved agent
or a lender, provided that the underlying transaction giving rise to the
compensating payment is a receipt of interest by a lender on the collateral
it received from its approved agent or a borrower;
(b) dividend includes, in relation to -
(i) a company that is not in the process of being wound up or liquidated,
profits, in any form, shared or distributed to the shareholders, including
an amount equal to the nominal value of bonus shares, debentures or
securities awarded to the company's shareholders,
(ii) a company that is being wound up or liquidated, any distribution,
whether in money or money's worth, earned before or during the winding
up or liquidation, and
(iii) regulated securities lending transaction, compensating payments
received by a lender from its approved agent or borrower;
(c) "royalty" includes payments of any kind received or receivable, paid
or payable as a consideration for the use of, or the right to use or exploit any
property;
(d) "money instruments" means instruments traded in money markets
including government securities, treasury Acts, treasury or savings
certificates, debenture certificates, commercial papers, certificates of
deposits, call money, commercial Acts, treasury bonds and any other money
instrument; and
(e) the transfer of securities or shares under a regulated securities lending
transaction shall not amount to a disposal, provided that such securities or
shares are transferred from a lender and subsequently returned by the
borrower to the lender.

(1) A company may be charged to tax –
Chargeability
to tax
(a) in its own name;
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(b) in the name of any principal officer, attorney, factor, agent or
representative of the company in Nigeria in the same manner or amount
that the company would have been charged; or
(c) in the name of its receiver, liquidator, or administrator, in the same
manner or amount that the company would have been charged if no receiver,
liquidator or administrator had been appointed.
(2) An individual may be charged to tax –
(a) in the individual's name;
(b) in the name of a family, trustee or estate; or
(c) in the name of an administrator, or any attorney, agent or representa-
tive in Nigeria, in like manner and to like amount as such an individual would
have been charged if no administrator, attorney, agent or representative had
been appointed.
PART II – TAXATION OF RESIDENT PERSONS

(1) The profits of a Nigerian company are deemed to accrue in Nigeria
Nigerian
company wherever the profits arise and whether or not such profits have been brought
into or received in Nigeria.
(2) Where a foreign company which is controlled by a Nigerian company
has not, in a year, distributed profits to its shareholders, the proportion of the
profits of the controlled foreign company attributable to the Nigerian company,
which could have been distributed without detriment to the company's business
shall be construed as distributed and included in the profits of the Nigerian
company for the purposes of subsection (1).
(3) Where the income tax paid by a non-resident company which is a
subsidiary of a Nigerian company or a member of a multinational group of a
Nigerian company in any year yields less than the minimum effective tax rate
prescribed by this Act, the Nigerian parent company shall pay an amount to
make that non-resident subsidiary's income tax equal to the minimum effective
tax rate.
(4) The Service shall provide detailed rules for the implementation of
subsections (2) and (3).
Nigerian divi- 7. (1) Nigerian dividends include –
dends
(a) dividend distributed by a Nigerian company, and shall be the gross
amount of that dividend before any deduction; and
(b) any amount of the undistributed profit of a Nigerian company, which
is treated as distributed under the provisions of any law in Nigeria.
(2) The income from a dividend distributed by a Nigerian company is
deemed to arise on the day on which payment of that dividend becomes due.
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(1) Nigerian dividends include –
dends
(a) dividend distributed by a Nigerian company, and shall be the gross
amount of that dividend before any deduction; and
(b) any amount of the undistributed profit of a Nigerian company, which
is treated as distributed under the provisions of any law in Nigeria.
(2) The income from a dividend distributed by a Nigerian company is
deemed to arise on the day on which payment of that dividend becomes due.
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(1) A company shall include dividend income in its profits, gross Profits of a
of any tax paid or deducted at source. company
from certain
dividends
(2) Dividends received by a Nigerian company by way of shares
of the paying company shall not be included in its profits chargeable to
tax under this Act and shall not be subject to the deduction prescribed
under section 51 of Nigeria Tax Administration Act, 2025.

(1) Where a Nigerian company declares dividend out of profits Substitution
on which no tax is payable due to – of dividend
for total
profit
(a) there being no total profits, or
(b) total profits which are less than the amount of dividend which
it declared, whether or not the recipient of the dividend is a Nigerian
company,
the company paying the dividend shall be charged to tax at the rate
prescribed in section 56 of this Act as if the dividend is the total
profits of the company for the year of assessment to which the ac-
counts, out of which the dividend is declared, relates.
(2) The provisions of subsection (1) shall not apply to –
(a) dividends declared out of the retained earnings of a company,
to the extent that the profits or gains included in the retained earnings
have been taxed under the provisions of this Act ;
(b) dividends declared out of profits or gains that are exempt from
income tax by this Act;
(c) franked investment income as provided in this Act; or
(d) distributions made by a real estate investment company to its
shareholders from rental income and dividend income received on
behalf of those shareholders, whether such dividends are paid out of
profits of the year in which the dividend is declared or out of profits of
previous reporting periods.

(1) Where a Nigerian company controlled by not more than Certain
five individuals has not distributed to its shareholders as dividend, profits undistributed
profits may
made in any period for which accounts have been made up by such
be treated as
company, the Service may direct that the proportion of the profits of the
distributed
company, which could have been distributed without detriment to the
company's business, be construed as distributed.
(2) The gross amount of profits construed as distributed under the
provisions of subsection (1) shall constitute a taxable income in the hand
of individual shareholders of the company in proportion to their
shareholdings in the ordinary capital of the company on the day of the
deemed distribution.
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(3) Any direction by the Service under this section shall be made in writing,
and be served on the company, and shall specify the –
(a) day to be taken for the purposes of this section;
(b) gross amount of those profits so deemed to be distributed;
(c) rate applied for the deduction at source, being the rate prescribed by
Nigeria Tax Administration Act, 2025; and
(d) net amount after the deduction at source.
(4) For the purposes of this section, the Service may give notice to any
company, which it has reason to believe is controlled by not more than five
individuals, requiring it to supply, within such time as contained in such notice,
full particulars of its shareholders.
(5) In the case of a limited liability partnership, all the profits of the
partnership shall be deemed as distributed, and taxable income, proportion-
ately, in the hands of the respective partners.
(6) Any direction by the Service under this section with respect to the
profits of any accounting period of a company shall be made not later than
three years after the receipt by the Service of the duly audited accounts of the
company for that period.
(7) A company in respect of which a direction is made under this section,
shall have a right of appeal in accordance with Chapter Two of Nigeria Tax
Administration Act, 2025.

(1) Where two or more companies carry out a trade or business in a
Partnership
of companies partnership, joint venture or a similar arrangement in Nigeria, any income or
profit arising therefrom shall constitute a source of profits and each company's
share shall be taxed separately.
(2) Where any of the companies in the partnership is a non-resident, its
share of income or profit from the partnership is chargeable to tax under this
Act.
(3) In the case of partnership carried on in a country other than Nigeria,
the partner that is taxable in Nigeria shall include its share of revenue and cost,
or profits in its assessable profits for the relevant year of assessment, and shall
supply to the tax authority, particulars of the determination of the revenue and
cost, or profit, with necessary adjustments made in accordance with the relevant
provisions of Chapter Two of this Act.
(4) The provisions of this section shall not apply to any partnership engaged
in petroleum operations under Chapter Three of this Act.

The income, gains or profits of an individual who is a resident of
Resident
individual Nigeria are deemed to accrue in Nigeria and are chargeable to tax in Nigeria
wherever they arise, and whether or not the income, profits or gains have been
brought into or received in Nigeria.
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(1) The income, gain or profit from an employment is derived Employment
from Nigeria where – income
(a) the employee is a resident of Nigeria ; or
(b) the duties of the employment are wholly or partly performed in
Nigeria and the remuneration is –
(i) paid by, or on behalf of, an employer who is a resident of
Nigeria,
(ii) borne by a Nigerian fixed base, permanent establishment or
any other form of taxable presence of a non-resident employer, or
(iii) not liable to tax in the employee's country of tax residence.
(2) Notwithstanding the provisions of subsection (1)(b), the em-
ployment income of a non-resident employee shall not be taxed in Ni-
geria where the –
(a) employer is a start-up, or is engaged in technology-driven serv-
ices or creative arts; and
(b) the employment income is taxable in the employee's country of
tax residence.
(3) The remunerations of an employee of the Government of Ni-
geria is derived from Nigeria where the employee performs the duties
of that employment in a country which, under an agreement or diplo-
matic privileges, exempts the remuneration from tax.
(4) Where the duties of an employment are wholly or mainly per-
formed in Nigeria, the remuneration from the employment during any
period of leave or temporary absence from Nigeria is derived from Ni-
geria.
(5) Notwithstanding the provisions of this section, the remunera-
tion of an individual from an employment is chargeable to tax in Nigeria
where the individual is a –
(a) seafarer serving under articles which he had signed in Nigeria,
or is performing a stand-by duty on-board a ship preparatory to his
signing articles in Nigeria;
(b) Nigerian and performs the duties of that employment in a for-
eign country, and that country exempts the remuneration from tax
under an agreement or diplomatic arrangement to which Nigeria is a
party; or
(c) Nigerian and performs the duties of the employment in Nigeria
for a foreign country or international organisation, and that remunera-
tion is not subject to tax in any other country under an agreement or
diplomatic arrangement to which Nigeria is a party.
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(6) For the purposes of this section –
(a) "financial technology" means the development and use of soft-
ware or technology as the primary and principal mode of providing financial
solution or service;
(b) "shared services" means services provided by a member of a group
of companies solely and exclusively to the other members of the group;
Act No. 32, (c) "startup" means a Nigerian company granted start-up label under

(1) Where an employer incurs an expense in the provision of any
kind benefit or perquisite, other than the provision of living accommodation to which
this section relates, the following provisions shall apply –
(a) where any asset belonging to the employer is used wholly or partly in
the making of such provisions, the employee is deemed to have earned
annual benefit of an amount equal to 5% of the amount expended by the
employer in acquiring the asset, but if that amount cannot be so ascertained,
5% of the market value of the asset at the time of the acquisition, as may be
determined by the relevant tax authority;
(b) where any sum by way of rent or hire is payable by the employer in
respect of any such asset, the employee is deemed to have earned annual
benefit of an amount equal to the annual amount of the rent or hire payable
by the employer on the asset; and
(c) in any other case, the employee is deemed to have earned annual
benefits equal to the annual amount expended by the employer in connection
with the benefit thereon.
(2) The amount of benefit under subsection (1)(a) shall be reduced by so
much of any expense made by the employee in respect thereon.
(3) The provisions of this section shall not apply to any expenses incurred
by an employer –
(a) in connection with the provision of meals in any canteen in which
meals are provided for the staff generally or meal vouchers for employees;
(b) in the provision of any uniform, overall or other protective clothing,
work tools or work equipment; or
(c) in connection with change in place of residence of the employee by
reason of a change of the employee's employment or place of exercising
the employment.
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(4) A reference in this subsection to expenses incurred in connection
with any matter includes a reference to a proportion of any expenses incurred
partly in connection with that matter.
(5) A reference in this section to anything provided for an employee shall,
unless the reference is expressly to something provided for the employee, be
construed as including a reference to anything provided for the spouse, family,
servant, dependant or guest of that employee by the employer.
(6) Where premises in Nigeria are made available by an employer to the
employee, the spouse or family, and the employee –
(a) pays no rent for the premises , or
(b) pays a rent less than the annual rental value of the premises,
the employee shall be treated as being in receipt of additional emolu-
ments equal to the annual rental value of the premises, subject to a maximum
of 20% of annual gross income from the employment, excluding the rental
value.
(7) In this section, "annual value of the premises" means –
(a) in relation to premises that are subject to a law governing assessment
of local rates, the annual rental value of the premises as determined for the
purposes of local rates under that law;
(b) in any other case, the annual rental value as determined by the
relevant tax authority; and
(c) a reference in this section to annual value shall include a reference,
where applicable, to such proper proportion of the annual value in relation
to –
(i) a period of occupation within a year,
(ii) the part of the premises occupied, or
(iii) both a period of occupation within a year and the part of the
premises occupied, as may be determined by the relevant tax authority.

(1) The gains or profits of a partner from a partnership shall be the Partnership
sum of – of individu-
als
(a) any remuneration, interest on capital, cost of passages wholly or
mainly undertaken for the purpose of leave or recreation, or any other per-
quisite or benefits in kind which is charged to the partnership accounts in
respect of that partner; and
(b) the partner's share in the profits of the partnership, computed in
accordance with Chapter two of this Act, after the deduction of charges to
which paragraph (a) applies in respect of all the partners:
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Provided that in arriving at the gains or profits of a partnership, private or
domestic expense of a partner shall not be deducted.
(2) Where the income computed under subsection (1) (b) results in a
loss for the partnership, the partner's share of the loss shall be deducted from
the gains or profits ascertained under the provisions of subsection (1) (a) and
the partner shall be deemed to have incurred a loss in the trade or business of
the partnership to the extent, if any, by which the deductible share of loss
exceeds those gains or profits.
(3) For the purpose of subsection (1), a partner's share of the partnership's
profits or losses shall be determined in the proportion specified in the partnership
agreement as if the entire profits or losses were distributed among the partners,
and where there is no partnership agreement, the profits or loss of the partnership
shall be distributed equally among the partners:
Provided that any person, whether resident or non-resident, who shares in the
profits of a Nigerian partnership shall file returns in his name and pay the
applicable tax.
(4) The gains, profits or losses of a partner for any period, ascertained
under this section, shall be deemed, for the purposes of Chapter Two of this
Act, to be the partner's income or loss from a trade, business, profession or
vocation carried on during that period, and the provisions of section 20 of this
Act shall not apply.
(5) The determination of the profits or losses that is attributable to a
partner from a partnership shall be made by the relevant tax authority in relation
to that partnership, and where any partner is taxable for a year of assessment
in the territory of another relevant tax authority, the relevant tax authority in
relation to that partnership shall make available to that other tax authority,
particulars of the determination of profits or losses.
(6) The income of a partner from a partnership in Nigeria shall be
Twelfth attributable to relevant territories in Nigeria in accordance with the Twelfth
Schedule Schedule to this Act.
(7) The partner, employee or agent in charge of the principal office or
place of business of a partnership in Nigeria shall, without notice or demand,
register or cause to be registered with the relevant tax authority, a certified
copy of the partnership deed or, where no written deed is in existence, particulars
of any written or oral agreement under which the partnership exists, and where
any such particulars have been registered, a notice of any change in the
agreement shall be registered with that tax authority within 30 days of the
change.
(8) Where the particulars of a partnership have been registered under
the provisions of subsection (7), the computation of the gains or profits of a
Nigeria Tax Act, 2025 2025 No. 7 A 403
partner, may be made by the relevant tax authority on the basis of those
particulars as they apply at any relevant time.
(9) Where the particulars of a partnership are not registered, in compliance
with subsection (7), tax may be assessed and charged by the relevant tax
authority as though the whole gains or profits of such partnership accrued to
any individual partner or were divisible between the partners, as may appear
just and reasonable to that tax authority.

The income of an individual, a trustee or executor from a settlement, Settlements,
trust, or estate of a deceased person, made, created or administered in or trusts and
estates
outside Nigeria, shall be ascertained in accordance with the provisions of the
Fifth
Fifth Schedule to this Act.
Schedule
PART III – TAXATION OF NON-RESIDENT PERSONS

(1) The income, profits or gains of a non-resident person accruing in, Non-Resident
or derived from Nigeria are chargeable to tax in accordance with the provisions person
of this Act.
(2) Gains derived by a non-resident person from disposal of chargeable
assets are taxable in Nigeria where the gains relate to –
(a) a trade, business, profession or vocation carried on by the non-resident
person in Nigeria;
(b) any asset located in Nigeria; or
(c) any asset deemed to be located in Nigeria under this Act.
(3) Profits derived from any trade, business, profession or vocation carried
on by a non-resident person are taxable in Nigeria where –
(a) the person has a permanent establishment or significant economic
presence in Nigeria to the extent that the profit is attributable to the permanent
establishment or significant economic presence;
(b) payment is made by a person resident in Nigeria or a permanent
establishment of a non-resident person in Nigeria, in respect of services
furnished from outside of Nigeria to a resident of Nigeria or a Nigerian
permanent establishment of a non-resident person, except where the payment
is made –
(i) to an employee of the person making the payment under a contract
of employment,
(ii) by an individual for teaching in an educational institution or for
teaching by an educational institution, or
(iii) by a foreign permanent establishment of a Nigerian resident and the
expense is borne by that permanent establishment; or
(c) payment is made to that person by a person resident in Nigeria or a
Nigerian permanent establishment of a non-resident person, in respect of
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insurance premiums or risks insured from the territory of Nigeria.
(4) Any amount deducted at source in accordance with section 51 of
Nigeria Tax Administration Act, 2025 from the payments made for any of the
activities mentioned in subsection (3) (b) and (c), shall be the final tax on that
payment unless the person has a permanent establishment or significant
economic presence in Nigeria to which the payment is attributable.
(5) The income, profits or gains of a non-resident person that are
attributable to its permanent establishment in Nigeria shall be ascertained in
accordance with the provisions of this Act, subject to the following
conditions –
(a) the permanent establishment shall be deemed to have the same credit
rating as the non-resident company of which it is a permanent establishment;
(b) the permanent establishment shall be deemed to have such equity
and loan capital as it could reasonably be expected to have in accordance
with section 191 of this Act ;
(c) the taxable profits to be attributed to the permanent establishment
shall include income arising from the –
(i) sale of goods or merchandise of the same or similar kind as those
sold through that permanent establishment, made directly to Nigeria by
the non-resident person or its connected persons, and
(ii) furnishing of services or any other business activity carried on in
Nigeria by the non-resident or its connected persons of the same or
similar kind as those effected through the permanent establishment;
(d) deduction shall not be made in respect of any cost except it was
incurred for and in the production of the taxable profits attributable to the
permanent establishment; and
(e) deduction shall not be allowed in respect of amounts paid or payable,
by the permanent establishment to the non-resident person or any of its
connected persons, by way of royalties, fees or similar payments in return
for the use of patents or other rights, other than towards reimbursement of
actual expenses.
(6) Where the total profits attributable to a permanent establishment or
significant economic presence in Nigeria cannot be ascertained in accordance
with subsection (5), the total profits shall be the amount resulting from applying
the profit margin of the non-resident person to the total income generated from
Nigeria.
(7) Where the total profits attributable to the permanent establishment or
significant economic presence in Nigeria is lower than an amount resulting
from applying the profit margin of the non-resident person to the total income
generated from Nigeria, the total profits shall be the amount resulting from
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applying the profit margin of the non-resident person to the total income generated
from Nigeria.
(8) Notwithstanding the provisions of subsections (6) and (7), the tax
payable under this section shall not be less than the tax withheld at source
under Nigeria Tax Administration Act, 2025, and where the income is not liable
to a deduction of tax under Nigeria Tax Administration Act, 2025, 4% of the
total income generated from Nigeria.
(9) For the purposes of this section –
(a) a non-resident person is deemed to have a permanent establishment
in Nigeria where the person –
(i) has a place, in Nigeria, through which its business is wholly or
partly carried on or at its disposal for the purposes of its business,
(ii) operates a trade or business through a person in Nigeria author-
ised to conduct on its behalf, or on behalf of some other persons controlled
by it, or which have a controlling interest in it,
(iii) maintains a stock of goods or merchandise in Nigeria from which
deliveries are made by a person on its behalf,
(iv) solely or together with any other person, executes a project in
Nigeria involving surveys, designs, deliveries, building, construction,
assembly or installation, commissioning or decommissioning or any
supervisory activity in connection with those activities, irrespective of
any split or number of entities that performed any of the activities of the
project and whether or not only part of the project was carried out in or
outside Nigeria, or
(v) furnishes any service in Nigeria through employees, agents,
subcontractors or other persons engaged by it for such purpose;
(b) a non-resident person shall, subject to any regulations that may be
issued by the Minister to that effect, have a significant economic presence
in Nigeria where the person transmits, emits or sends by itself or through
other person, signals, sounds, messages, images or data of any kind by
cable, radio, electromagnetic systems or any other electronic or wireless
apparatus to Nigeria in respect of any activity, including electronic commerce,
application store, high frequency trading, electronic data storage, online
adverts, participative network platform, online payments, supply of user-
data, search engines, digital content services, online gaming, cloud computing,
online teaching services, and profit can be attributable to such activity;
(c) a non-resident person shall not be deemed to have a permanent
establishment or significant economic presence in Nigeria solely by reason of
employing persons resident in Nigeria, to the extent that the duties of such
employment are not performed primarily for customers in Nigeria;
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(d) "a place" means any location in Nigeria, whether owned, rented,
leased or otherwise available for the use of the person, irrespective of the
length of time it is used and shall include –
(i) a place of management,
(ii) a branch,
(iii) a sales outlet,
(iv) an office,
(v) a factory,
(vi) a workshop,
(vii) a mine, a well for crude oil, gas, bitumen, water or any other
natural resource, a quarry or any other place of extraction or exploitation
of natural resources, or any supervisory activity in connection to it,
(viii) facilities, including vessel, any installation or structure, used in
the exploration of natural resources, or any supervisory activity in
connection with such facilities,
(ix) a building, construction, assembly or installation site, or
(x) any place for performing supervisory activity or any service or
activity; and
(e) "profit margin" of a person shall be the proportion of the earnings
before interest and tax (EBIT) to income or revenue in its published audited
financial statement, and in the case of persons that have no published
financial statements for the period or are not required to publish financial
statements, the profit margin as may be ascertained by the relevant tax
authority from the published financial statements of a comparable company.
Non-resident

(1) Where a non-resident person carries on the business of transport
person by sea or air, and any ship or aircraft owned, leased or chartered by it calls at
engaged in
any port in Nigeria, the non-resident person is chargeable to tax on the profits
shipping or
arising from the carriage of passengers, mails, livestock or goods shipped from,
air transport
or loaded into an aircraft or ship, in Nigeria.
(2) The provisions of subsection (1) shall not apply to passengers, mails,
livestock or goods which are brought into Nigeria solely for trans-shipment or
for transfer from one aircraft to another or between an aircraft and a ship.
(3) For the purposes of subsection (1), where the Service is satisfied that
the tax authority of the country of residence of a non-resident person computes
and assesses the profits of its resident that operates ships or aircraft to Nigeria
on a basis not materially different from that prescribed in this Act, the total
profits or loss derived from Nigeria for that period shall be determined, using -
(a) the ratio of profits or loss of the company, before any allowance by
way of depreciation, of an accounting period to the gross revenue in respect
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of carriage of passengers, mails, livestock or goods (global adjusted profit
ratio); and
(b) ratio of allowances by way of depreciation for that period to the
gross revenue by the company in respect of carriage of passengers, mails,
livestock or goods (global depreciation ratio).
(4) For the purposes of subsection (3), the total profits of a period shall
be taken to be the proportion to the gross revenue in respect of the carriage of
passengers, mails, livestock or goods shipped or loaded in Nigeria, which is
determined by applying the -
(a) global adjusted profit ratio to the gross revenue in respect of the
carriage of passengers, mails, livestock or goods shipped or loaded in Nigeria
to arrive at the assessable profits; and
(b) global depreciation ratio to the gross revenue in respect of the carriage
of passengers, mails, livestock or goods shipped or loaded in Nigeria, in
place of any allowances to be given under the provisions of Part I of the
First Schedule.
(5) Where at the time of assessment, the provisions of subsections (3)
and (4) cannot for any reason be satisfactorily applied, the total profits shall be
-
(a) the amount resulting from multiplying the turnover generated from
Nigeria by the profit margin as defined under section 17(9)(e) of this Act; or
(b) the profits deemed to be derived from Nigeria, which, on the direction First
of the Service, shall be computed on a fair percentage of the gross revenue in Schedule
respect of the carriage of passengers, mails, livestock and goods shipped from
or loaded in Nigeria.
(6) For the purposes of this section, the tax payable by a person for any
year of assessment shall not be less than 2% of the gross revenue in respect of
the carriage of passengers, mails, livestock or goods shipped from, or loaded
into an aircraft in Nigeria, which shall be computed, assessed and paid on
monthly basis.
(7) Notwithstanding any other provision of this Act, where a person to
which this section applies files a tax return and does not provide a separate
financial statement of the Nigerian operations, such person shall submit detailed
gross revenue statements of its Nigerian operations, certified by one of its
directors and its external auditors, and supported with the contract agreements.
(8) The provisions of this section shall not apply to income or profits
arising from leasing of vessels or containers, non-freight operations or any
other incidental income, such income or profits are chargeable to tax under
relevant provisions of this Act.
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(9) Regulatory agencies in the shipping and air transport, and other relevant
sectors shall, as a condition to carry on business in Nigeria or obtaining any
relevant approvals or permits, mandate all persons taxable under the provisions
of this section to present the following –
(a) evidence of income tax filing for the preceding tax year;
(b) tax clearance certificates, showing income taxes paid for the three
preceding tax years; or
(c) evidence of tax declaration and payment in respect of the intended
carriage or shipment.
Nigerian

(1) There shall be no further tax charged in respect of any dividend
dividends received by a non-resident from a Nigerian company other than tax deducted
received by
at source under the Nigeria Tax Administration Act, 2025.
Non-
Resident
(2) Nothing in this Act shall confer on the non-resident or the Nigerian
persons
company paying the dividend, a right to repayment of tax paid under section 51
of the Nigeria Tax Administration Act, 2025
PART IV – ASCERTAINMENT OF PROFITS AND INCOME
Deductions 20. (1) Except where the provisions of section 18 of this Act or Part IX
Allowed of Chapter Two apply, for the purposes of ascertaining the profits or loss from
any trade, business, profession or vocation under this Act, there shall be deducted
all expenses for that period wholly and exclusively incurred in the production
of the income, including –
Third (a) any sum payable by way of interest on debt employed in generating
Schedule the income of the trade, business, profession or vocation, subject to the
provisions of the Third Schedule to this Act;
(b) rent and premiums, incurred during that period, in respect of land or
building occupied for the purposes of generating the income;
(c) any outlay or expenses incurred in respect of –
(i) salary, wages or other remuneration paid to employees, and
(ii) cost to the company of any benefit or allowance provided to its
employees;
(d) any expense incurred for repair of premises, plant, machinery or
fixtures employed in acquiring the income, or for the renewals, repair or
alteration of any implement, utensil or articles so employed;
(e) any amount of expenditure incurred for establishing, preserving or
defending title to or rights over an asset ;
Act No. 4, (f) any contribution to any staff pension, provident or other retirement

(1) Except where the provisions of section 18 of this Act or Part IX
Allowed of Chapter Two apply, for the purposes of ascertaining the profits or loss from
any trade, business, profession or vocation under this Act, there shall be deducted
all expenses for that period wholly and exclusively incurred in the production
of the income, including –
Third (a) any sum payable by way of interest on debt employed in generating
Schedule the income of the trade, business, profession or vocation, subject to the
provisions of the Third Schedule to this Act;
(b) rent and premiums, incurred during that period, in respect of land or
building occupied for the purposes of generating the income;
(c) any outlay or expenses incurred in respect of –
(i) salary, wages or other remuneration paid to employees, and
(ii) cost to the company of any benefit or allowance provided to its
employees;
(d) any expense incurred for repair of premises, plant, machinery or
fixtures employed in acquiring the income, or for the renewals, repair or
alteration of any implement, utensil or articles so employed;
(e) any amount of expenditure incurred for establishing, preserving or
defending title to or rights over an asset ;
Act No. 4, (f) any contribution to any staff pension, provident or other retirement

A deduction shall not be allowed for the purposes of ascertaining the
not allowed
profits or income from any trade, business, profession or vocation in respect
of –
(a) capital repaid or withdrawn from a trade, business, profession or
vocation;
(b) any expenditure of a capital nature;
(c) domestic or private expense, or expenditure on assets not used for
the purpose of trade, business, profession or vocation;
(d) any sum recoverable under an insurance or contract of indemnity;
(e) taxes on profit or incomes levied in Nigeria or elsewhere;
Act No. 4, (f) any payment to a savings, widows and orphans, pension, provident or

(1) Except as provided in this section, the profits of any trade, business, Basis for
profession or vocation for each year of assessment (the assessable profits) computing
shall be the profits of the accounting period immediately preceding the year of assessable
profits for
assessment from all sources.
trade or
(2) Notwithstanding the provisions of subsection (1), the assessable profits business
of the first year of assessment for a new business, shall be the profits from the
date in which such trade, business, profession or vocation commences in Nigeria
to the end of the first accounting period.

(1) Where a taxable person changes the date to which it usually Change in
computes its assessable profits, the basis period for the computation of the accounting
date
assessable profits for the relevant year of assessment shall be the period
commencing from the first day after the basis period of the immediately
preceding year of assessment up to the new date on which the account was
made, and the assessable profits of subsequent years of assessments shall be
computed on the basis of the new accounting period.
(2) Where there is a change in the accounting date under subsection (1),
the taxable person shall notify the relevant tax authority not later than 30 days
before the usual due date of filing its income tax returns.

(1) Where a trade, business, profession or vocation permanently Cessation of
ceases to carry on operations in Nigeria in an accounting period, the assessable trade or
business
profits for the relevant year of assessment shall be the amount of the profits
from the beginning of the accounting period to the date of cessation and the
tax shall be payable within six months from the date of cessation.
(2) Where, after the date of cessation, the trade, business, profession or
vocation, or its receivers or liquidators, receive or pay any sum which ought to
have been included in or deducted from the profits of that trade or business if
it had been received or paid prior to that date, such sum shall be deemed for
the purposes of this Act to have been received or paid by the trade, business,
profession or vocation on the last day before such cessation occurred and
such sums shall be disclosed to the relevant tax authority within one month of
the receipt or payment.
(3) Where the provisions of subsection (2) apply, any additional assess-
ment or claim for reduction of assessment or repayment of tax shall be made
as may be necessary to give effect to the provisions, provided that the provi-
sions of the Nigeria Tax Administration Act, 2025, relating to objections and
appeals shall apply to the additional assessment or claim of reduction of as-
sessment or repayment of tax under this subsection.
(4) In the case of a deceased individual, where the personal representa-
tive after death, receives or pays any sum which would have been included in
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or deducted from the gains or profits from the trade, business, profession or
vocation carried on prior to death, that sum shall be deemed for all purposes of
this Act to have been received or paid by the deceased, on the last day prior to
the death.

An individual carrying on a trade, business, profession or vocation,
Continuity
of trades shall not be treated as having commenced or ceased to do so solely by reason
of a change in the territory in which the individual is resident from one year to
another, or by reason of becoming or ceasing to be a partner in a partnership if
the nature of the trade carried on by that partnership is the same as that
carried on before or after the individual became or ceased to be a partner.

(1) With respect to income from an employment or pension, the
computing assessable income of an individual shall be the amount of the income of the
assessable year of assessment.
profits for
trade or (2) For the purpose of subsection (1), income from an employment shall
business be deemed to arise from day to day except to the extent that it is derived from
any bonus, commission or allowance payable on one occasion only or at intervals
exceeding one month, and to that extent it shall be deemed to be income –
(a) of the day on which it is paid; or
(b) where it is paid after the cessation of the employment, of the last day
of the employment including any terminal benefit arising therefrom.
(3) With respect to disposal of a chargeable asset, the assessable income
of an individual shall be the amount of the chargeable gains accruing from
assets disposed during the year immediately preceding the year of assessment,
except for chargeable gains accruing from the disposal of chargeable assets
used in the individual's trade, business, profession or vocation, which shall be
those disposed during the year immediately preceding the year of assessment.
Fifth (4) Notwithstanding the foregoing provisions of this section, the assessable
Schedule income of a trustee, or of an executor of the estate of a deceased individual, or
of a beneficiary of a trust or estate for any year of assessment shall be the
income of that person for the year preceding that year of assessment as
determined under the provisions of the Fifth Schedule to this Act.
PART VI – ASCERTAINMENT OF TOTAL PROFITS
OF COMPANIES

(1) The total profits of a company for any year of assessment, shall
ment of total
be the amount of its total assessable profits from all sources, including chargeable
profits of
gains computed in accordance with Part VIII of Chapter Two, less the amount
companies
of any loss ascertained in accordance with subsection (6), and capital allowance
First
in accordance with the provisions of Part I of the First Schedule to this Act.
Schedule
(2) The capital allowance to be deducted in accordance with the provisions
Nigeria Tax Act, 2025 2025 No. 7 A 413
of Part I of the First Schedule shall be the amount relating to the qualifying First
capital expenditure incurred in generating the assessable profits: Schedule
Provided that where value added tax is due under this Act but not charged
on an asset, or in the case of an imported item, where the applicable import
duty or levy was not paid, the relevant expenditure shall not be eligible as a
qualifying capital expenditure.
(3) Where the qualifying capital expenditure is in relation to an asset that
is only partly utilised in generating the assessable profits, the capital allowance
on such qualifying capital expenditure shall be prorated and only the portion
relating to the taxable income shall be allowed as a deduction.
(4) The capital allowance computed shall not be prorated where the
non-taxable income constitutes less than 10% of the total income of the
company.
(5) Notwithstanding the provisions of subsection (4), the portion of capital
allowance attributable to priority activities of a company that enjoys economic
development incentive under this Act shall be deducted only from the assessable
profits of the priority business:
Provided that –
(a) in no circumstances shall the aggregate loss deductions from the
assessable profits or income exceed the amount of that loss;
(b) loss can only be deducted from the trade or business in which the
loss was incurred ;
(c) the loss shall be deducted to the extent possible from the amount of
the assessable profits of the first year of assessment after that in which the
loss was incurred, and in subsequent years until the loss is fully recouped;
and
(d) the loss incurred during any year of assessment shall be computed, in
accordance with the basis period provided in sections 22 to 25 of this Act.
(6) Notwithstanding subsection (5) or any provision of this Act, any loss
incurred in any period from sales, disposal or any other transaction in digital
assets shall only be deductible in determining the profits from the business
relating to digital or virtual assets.
PART VII – ASCERTAINMENT OF TOTAL INCOME OF AN
INDIVIDUAL

(1) The total income of an individual for any year of assessment is Total income
the taxable income less total deduction. of an
individual
(2) For the purposes of subsection (1) –
(a) taxable income is the aggregate amount of –
A 414 2025 No. 7 Nigeria Tax Act, 2025
(i) assessable profits from trade, business, profession or vocation
ascertained in accordance with Part V of Chapter Two of this Act,
(ii) employment income,
(iii) income from investing activities,
(iv) profits or income from any other source, and
(v) chargeable gains from the disposal of chargeable assets.
(b) total deduction is the sum of –
(i) any loss ascertained in accordance with subsection (2),
First (ii) capital allowance in accordance with the provisions of Part I of
Schedule the First Schedule to this Act,
(iii) income of the individual that is exempt from tax under this Act,
and
(iv) income of the individual on which the tax deducted at source
under section 51 of Nigeria Tax Administration Act, 2025 is the final tax.
(3) The loss to be deducted in arriving at the total income of an individual
is –
(a) the amount of a loss incurred by the individual during the year or
preceding year of assessment in a trade, business, profession or vocation;
and
(b) the amount of loss incurred on the disposal of a chargeable asset:
Provided that –
(i) in no circumstances shall the aggregate loss deductions from income
exceed the amount of that loss,
(ii) the loss shall be deducted as far as possible from assessable profit
of a trade, business, profession or vocation of the first year of assessment
after that in which the loss was incurred, and in subsequent years until
the loss is fully recouped,
(iii) the loss incurred during any year of assessment shall be com-
puted, in accordance with the basis period contained in Part V of Chap-
ter Two of this Act, and
(iv) any loss incurred in any period from sales, disposal or any other
transaction in digital or virtual assets shall only be deductible against the
profit or gain from digital or virtual assets.
Presumptive 29. Notwithstanding any provisions of Chapter Two of this Act, where
taxation for all practical purposes, the income of a person chargeable to tax under this
Act cannot be ascertained or records are not kept in such a manner as to
enable proper assessment of income, then such person shall be assessed on
such terms and conditions as may be prescribed by the Minister on the advice
of the Joint Revenue Board in a regulation under a presumptive tax regime.
Nigeria Tax Act, 2025 2025 No. 7 A 415

Notwithstanding any provisions of Chapter Two of this Act, where
taxation for all practical purposes, the income of a person chargeable to tax under this
Act cannot be ascertained or records are not kept in such a manner as to
enable proper assessment of income, then such person shall be assessed on
such terms and conditions as may be prescribed by the Minister on the advice
of the Joint Revenue Board in a regulation under a presumptive tax regime.
Nigeria Tax Act, 2025 2025 No. 7 A 415

(1) The chargeable income of an individual, is the total income of Ascertain-
that individual ascertained under the provisions of section 28 of this Act, less ment of
chargeable
eligible deductions.
income of
(2) For the purposes of this section – individuals
(a) "eligible deductions" include payments made by the individual in a
year of assessment in respect of –
(i) the individual's contributions under the National Housing Fund,
(ii) the individual's contributions under the National Health Insurance
Scheme,
(iii) the individual's contributions under the Pension Reform Act, Act No. 4,
2014
(iv) interest on loans for developing an owner-occupied residential
house,
(v) annual amount of any annuity or premium paid by the individual
during the year preceding the year of assessment in respect of insurance
on his life or the life of his spouse, or contract for a deferred annuity on
his own life or the life of his spouse; and
(vi) rent relief of 20% of annual rent paid, subject to a maximum of
N500,000, whichever is lower, provided that the individual accurately
declares the actual amount of rent paid and other relevant information as
may be prescribed by the relevant tax authority ; and
(b) "total income" means total income as specified in section 28 of this
Act.

Deduction shall not be allowed under this Part to any person for a
Deductions
year of assessment, unless claimed in writing in such form as the relevant tax to be claimed
authority may prescribe.

(1) The relevant tax authority may require a claimant to a deduction Proof of
under section 30 (2) (a) of this Act to produce such documentary evidence as claims
may be necessary in support of any claim and in the absence of such evidence,
or where such evidence is inadequate, the relevant tax authority may refuse to
allow the deduction or such part of the amount claimed.
(2) Notwithstanding any provision of this Part, where –
(a) an individual fails to produce satisfactory documentary evidence in
support of a claim under section 30 (2) (a) of this Act, any objection to an
assessment or, to any rate at which tax is to be deducted, shall be
accompanied by a copy of the available documentary evidence or a
declaration that such required documentary evidence does not exist; and
(b) an individual claims a deduction under this Act for a year of assessment,
or produces evidence in support of a claim previously made but not admitted
or not admitted in full by the relevant tax authority, such repayment, set-off
A 416 2025 No. 7 Nigeria Tax Act, 2025
of tax or reduction in any assessment shall be made so as to give effect to
any amount or additional amount of the deduction as appropriate.
PART VIII – ASCERTAINMENT OF CHARGEABLE GAINS
Chargeable

(1) Gains accruing to any person in a year of assessment shall be
Gains
chargeable to tax in accordance with the provisions of this Act.
(2) Gains on which tax is to be assessed on any person shall be computed
in accordance with the provisions of this Part.

(1) Subject to exemptions as may be provided in Part I of Chapter
Chargeable
assets Eight of this Act, all forms of property shall be chargeable assets for the purpose
of this Part, whether situated in Nigeria or not, including –
(a) any form of asset, shares, options, rights, debts, digital or virtual assets
and incorporeal property generally:
Provided that gains accruing to a person on disposal of shares in any
Nigerian company shall not be chargeable gains where the –
(i) disposal proceeds, in aggregate, is less than N 150,000,000 and the
chargeable gain does not exceed N 10,000,000 in any 12 consecutive
months,
(ii) shares are transferred between an approved borrower and a lender
in a regulated securities lending transaction, or
(iii) proceeds from such disposal, notwithstanding the threshold in (i),
are reinvested within the same year of assessment in the acquisition of
shares in the same or other Nigerian companies, provided that tax shall
accrue proportionately on the portion of the proceeds which are not
reinvested in the manner stipulated in this subsection;
(b) any currency other than Nigerian currency; and
(c) any form of property created by the person disposing of it or coming
to be owned without being acquired.
(2) This section shall have effect, notwithstanding that the property is an
asset in respect of which qualifying capital expenditure had been incurred
under any provision of this Act.

(1) For the purpose of this Act, there is a disposal of assets by a
assets person where any sum is derived from a sale, lease, transfer, an assignment, a
compulsory acquisition or any other disposition of assets, subject to any
exemptions as may be provided in Chapter Eight of this Act.
(2) Subsection (1) shall apply, notwithstanding that no asset is acquired
by the person paying the sum, and in particular where the sum is –
(a) derived by way of compensation for any loss of office or employ-
ment;
Nigeria Tax Act, 2025 2025 No. 7 A 417
(b) received under a policy of insurance and the risk of any kind of injury
or damage, or the loss or depreciation of assets;
(c) received in return for forfeiture or surrender of a right, or for refraining
from exercising a right; and
(d) received as consideration for use or exploitation of any asset.
(3) In this Part –
(a) references to a disposal of assets include, references to a part disposal
of assets; and
(b) there is a part disposal of assets where –
(i) an interest or right in or over the assets is created for another
person by the disposal, and
(ii) a part of the interest in the property which subsists before the
disposal remains with the person making the disposal.

(1) Subject to the provisions of this Act, the acquisition and disposal Disposal of
of an asset by a person shall be deemed to be for a consideration equal to the assets,
market value of the asset where the person acquires the asset – provisions as
to consider-
ations
(a) otherwise than by way of a bargain made at arm's length;
(b) wholly or partly for a consideration that cannot be valued;
(c) as trustee for creditors of the person making the disposal; or
(d) upon devolution on death as a personal representative or legatee of a
deceased.
(2) Where a person disposes of an asset by way of gift, other than asset
acquired or disposed by devolution on death, the person acquiring the asset
shall, as it relates to the interest taken by the person, be deemed to have
acquired the asset –
(a) for a consideration equal to the amount for which the asset was last
disposed of by way of a bargain made at arm's length; or
(b) where the amount last disposed of by way of bargain made at arm's
length cannot be ascertained, for a consideration equal to the market value
of the asset on the date of that disposal.
(3) Where an asset is held by a person as a nominee or trustee for –
(a) another person absolutely entitled,
(b) an infant or a person with disability, or
(c) two or more persons,
the provisions of this Part shall apply as if the property were vested in, and
the acts of the nominee or trustee in relation to the asset were the acts of
the person or persons referred to in this subsection.
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(4) Any acquisition of the asset referred to in subsection (3) by the
nominee or trustee or the disposal of the assets to the nominee or trustee shall
be disregarded.
(5) The conveyance or transfer by way of security of an asset or of an
interest or right in or over it, or transfer of a subsisting interest or right by way
of security in or over an asset, including a re-transfer on redemption of the
security, shall not be treated as involving any acquisition or disposal of the
asset.
(6) Any dealing with an asset by a person who has a security interest in
it or who has the benefit of a charge against it or an encumbrance against it in
order to enforce or give effect to those rights shall be deemed to have been
made by that person in his capacity as that person's nominee.
(7) An asset shall be treated as having been acquired free of any interest
or right by way of security subsisting at the time of any acquisition of it, and as
being disposed of free of any such interest or right subsisting at the time of the
disposal, and where an asset is acquired subject to any such interest or right,
the full amount of the liability thereby assumed by the person acquiring the
asset shall form part of the consideration for the acquisition and disposal in
addition to any other consideration.
(8) Where an asset is acquired by a creditor in satisfaction of his debt or
part of it –
(a) the asset shall not be treated as disposed of by the debtor or acquired
by the creditor for a consideration greater than its market value at the time
of the creditor's acquisition of it; and
(b) chargeable gain accruing to the creditor on disposal of the asset shall
not exceed the chargeable gain which would have accrued if he had acquired
the property for a consideration equal to the amount of the debt or that part.
(9) In this section –
"legatee" includes any person taking under a testamentary disposition or
on an intestacy or partial intestacy, whether he is taken as a beneficiary or
trustee, and a gift made in contemplation or condition of death shall be treated
as a testamentary disposition and not as a gift;
"personal representatives" means –
(a) the executor or the representative, or administrator for the time being
of a deceased person under any law in force in Nigeria; or
(b) persons who, under the law of another country, have functions
corresponding to personal representatives as defined under paragraph (a).
Compulsory

(1) A person shall not be charged to tax under this Act in respect of
acquisition
gains on any acquisition and disposal of land by reference to a disposal to an
of land
authority exercising or having compulsory powers, if that person had not –
Nigeria Tax Act, 2025 2025 No. 7 A 419
(a) acquired the land at a time when he knew or might reasonably have
known that it was likely to be acquired by the authority; or
(b) taken any steps by advertisement or otherwise to dispose of the land
or to make his willingness to dispose of it known to the authority or others.
(2) In this section, "authority exercising or having compulsory
powers" means, in relation to any disposal of land, an authority, a person or
body of persons acquiring the land compulsorily under the Land Use Act or Cap L5,
any other similar enactment or law of a country other than Nigeria, or who has LFN 2004
or have been, or may be authorised to acquire it compulsorily for the purposes
for which it is acquired, or for whom another authority, person or body of
persons has or have been, or may be authorised to acquire it.

Any asset acquired or disposed of by a person chargeable to tax Date of
shall, be deemed to have been acquired or disposed of at the date at which acquisition
or disposal
there is an enforceable right to acquire or a binding duty to dispose of the asset
or any right or interest in it, and in particular, where –
(a) any contract is to be performed subject to any condition, the date of
acquisition or disposal of the asset shall be the date the condition is satisfied;
(b) consideration under the contract does not depend solely or mainly on
the value of the asset at the time the condition is satisfied, the acquisition or
disposal shall be treated as if the contract had never been conditional, in
which case the date of the acquisition or disposal of the asset shall be the
date of the contract; or
(c) an option is conferred by virtue of any contract, the date of the
acquisition or disposal of the asset shall be the date when the option is
exercised.

The gains chargeable to tax shall, subject to other provisions of this Computation
Act, be computed as follows – of chargeable
gains
(a) in the case of a disposal of an asset used for a trade, business, pro-
First
fession or vocation, for which capital allowance has been made in accord- Schedule
ance with the First Schedule to this Act, only the residue of that asset shall
be deducted from the disposal proceeds for the purposes of computing
chargeable gains; and
(b) where capital allowance has not been made in accordance with the First
First Schedule to this Act, the chargeable gain shall be determined by Schedule
deducting from the disposal proceeds, the amount or value of the
consideration, in money or money's worth incurred, wholly and exclusively
for the acquisition of the asset.
Expenses

Any incidental cost incurred wholly and exclusively for the purpose
incurred for
of disposal of a chargeable asset is deductible from the disposal proceeds for
disposal of
the purposes of determining the chargeable gain. chargeable
assets
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Any incidental cost incurred wholly and exclusively for the purpose
incurred for
of disposal of a chargeable asset is deductible from the disposal proceeds for
disposal of
the purposes of determining the chargeable gain. chargeable
assets
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Part disposal 41. (1) Where a part of an asset is disposed or where some property
derived from an asset remains undisposed after a disposal of the asset –
(a) the acquisition cost of the assets, together with any expenditure wholly
and exclusively incurred for the purpose of enhancing the value of the asset;
or
First (b) the residue, in the case of assets used for trade or business on which
Schedule capital allowance have been made in accordance with the First Schedule to
this Act,
shall be apportioned between the disposed part and the undisposed part.
(2) Apportionment shall be made by reference to –
(a) the amount or value of the consideration for the disposal on the one
hand, referred to as "A"; and
(b) the market value of the property which remains undisposed on the
other hand referred to as "B".
(3) The acquisition cost or residue of the disposed part shall be apportioned
by applying the fraction A/(A+B), and the remainder shall be attributed to the
part which remains undisposed.
(4) Where a portion of interest or right in a chargeable asset is disposed,
and some part of that asset or any description of property derived from the
asset remains undisposed, the cost of acquisition in addition to any incidental
cost of the acquisition, or residue of the asset, shall be apportioned based on
the value of the sale compared to the market value of the undisposed portion.
Consider- 42. (1) Where the consideration or part of a consideration, taken into
ation due account in the computation of chargeable gains under section 39 of this Act, is
after time of payable by instalments over a period exceeding twelve months, beginning from
disposal
the time when the disposal is made, the chargeable gain accruing on the dis-
posal shall be regarded as accruing in proportionate parts in the period of
assessment in which the disposal is made and in subsequent periods of assess-
ments, until the last instalment is payable.
(2) The proportionate parts to be recorded as accruing in the respective
periods of assessment shall correspond to the proportions of the amounts of
the instalments of consideration payable in those respective periods of
assessment.
(3) The time in the year or accounting period when any part of a
chargeable gain is deemed to accrue under this section shall be the last day in
that year of assessment, except in the case of cessation of a trade, business,
profession or vocation, or death of the alienator, where such part shall be
deemed to accrue on the date of cessation or death.
(4) The provisions of subsection (1) shall not apply to any part of the
Nigeria Tax Act, 2025 2025 No. 7 A 421
consideration which has effectively passed to the person making the disposal
by way of a loan made to that person by the other party to the transaction.
(5) In the computation of chargeable gains under this section –
(a) consideration for the disposal shall, in the first instance, be brought
into account without –
(i) any adjustment for postponement of the right to receive any part of
it, and
(ii) regard to a risk of any part of the consideration being irrecover-
able, or to the right to receive any part of the consideration being contingent;
and
(b) where any part of the consideration so brought into account is
subsequently shown to the satisfaction of the relevant tax authority to be
irrecoverable, such adjustment, whether by way of discharge, or repayment
of tax or otherwise, shall be made as required.

(1) Where a part of an asset is disposed or where some property
derived from an asset remains undisposed after a disposal of the asset –
(a) the acquisition cost of the assets, together with any expenditure wholly
and exclusively incurred for the purpose of enhancing the value of the asset;
or
First (b) the residue, in the case of assets used for trade or business on which
Schedule capital allowance have been made in accordance with the First Schedule to
this Act,
shall be apportioned between the disposed part and the undisposed part.
(2) Apportionment shall be made by reference to –
(a) the amount or value of the consideration for the disposal on the one
hand, referred to as "A"; and
(b) the market value of the property which remains undisposed on the
other hand referred to as "B".
(3) The acquisition cost or residue of the disposed part shall be apportioned
by applying the fraction A/(A+B), and the remainder shall be attributed to the
part which remains undisposed.
(4) Where a portion of interest or right in a chargeable asset is disposed,
and some part of that asset or any description of property derived from the
asset remains undisposed, the cost of acquisition in addition to any incidental
cost of the acquisition, or residue of the asset, shall be apportioned based on
the value of the sale compared to the market value of the undisposed portion.

(1) Where an asset is lost or destroyed, and a capital sum received Assets lost
by way of compensation for the loss or destruction is applied within three or destroyed
years of receipt in acquiring another asset in its replacement, the owner shall,
where the compensation received together with the residual or scrap value
is –
(a) greater than the cost of the asset acquired in replacement of the lost
or destroyed asset, be deemed to make a chargeable gain; and
(b) lower than the cost of the asset acquired in its replacement, be deemed, First
for the purposes of the First Schedule to this Act, to have acquired an Schedule
additional asset for an amount equal to the cost of that new asset, less the
compensation together with the residual or scrap value.
(2) Except for the additional asset acquired under subsection (1)(b), al- First
lowance to be claimed on the new asset for the purposes of the First Schedule Schedule
to this Act shall be limited to the residue of the old asset, if any.

(1) Where a single bargain comprises two or more transactions Bargains
whereby assets are disposed of, those transactions shall be treated for the comprising
two or more
purposes of computing chargeable gains as a single disposal.
transactions
(2) Where separate considerations are agreed or purported to be agreed
for any two or more transactions comprised in one bargain, whether transactions
whereby assets are disposed of or not, those considerations shall be treated as
altogether constituting an entire consideration for the transactions and shall be
apportionable between them.
(3) Where an apportionment under this section results in less considera-
tion being attributed to the chargeable asset than that agreed or purported to
be agreed, in the bargain, the separate considerations shall be the consideration
for which those assets are disposed of.
A 422 2025 No. 7 Nigeria Tax Act, 2025

(1) For the purposes of computing chargeable gains, unless the context
market value otherwise requires, market value, in relation to any asset, means the price
which the asset might reasonably be expected to fetch on a sale conducted at
arm's length, or in the open market.
(2) In estimating the market value of any asset in the case of a disposal,
no reduction shall be taken into account for cash or bulk discount.
(3) In determining the acquisition cost of any asset, where the actual
consideration paid by the acquirer is less than the market value, the assets
shall be deemed to have been acquired for the amount actually paid.
Location of 46. For the purposes of Chapter Two of this Act –
assets
(a) the situation of rights or interests, other than by way of security, in or
over immovable property is that of the immovable property;
(b) the situation of rights or interests, other than by way of security, in or
over tangible movable property is that of the tangible movable property;
(c) a debt, secured or unsecured, is situated in Nigeria where the creditor
is resident in Nigeria, or has a permanent establishment in Nigeria to which
the debt relates;
(d) shares or securities issued by any governmental, municipal or local
authority, or by a body created by such an authority, are situated in the
country of that authority or place where the authority is situated;
(e) subject to paragraph (d), registered shares or securities are situated
where they are registered and, if registered in more than one register, where
the principal register is situated;
(f) notwithstanding paragraph (e), shares or comparable interests in any
foreign entity are deemed to be located in Nigeria, if, at any time during the

For the purposes of Chapter Two of this Act –
assets
(a) the situation of rights or interests, other than by way of security, in or
over immovable property is that of the immovable property;
(b) the situation of rights or interests, other than by way of security, in or
over tangible movable property is that of the tangible movable property;
(c) a debt, secured or unsecured, is situated in Nigeria where the creditor
is resident in Nigeria, or has a permanent establishment in Nigeria to which
the debt relates;
(d) shares or securities issued by any governmental, municipal or local
authority, or by a body created by such an authority, are situated in the
country of that authority or place where the authority is situated;
(e) subject to paragraph (d), registered shares or securities are situated
where they are registered and, if registered in more than one register, where
the principal register is situated;
(f) notwithstanding paragraph (e), shares or comparable interests in any
foreign entity are deemed to be located in Nigeria, if, at any time during the
days preceding the alienation, more than 50% of the value of the shares
or other interests is derived, directly or indirectly –
(i) through one or more interposed entities resulting in the change in
direct or indirect ownership structure of a Nigerian entity, or
(ii) from immovable property or any other chargeable assets situated
in Nigeria;
(g) subject to paragraph (d), shares or comparable interest in an entity is
situated in Nigeria, if the entity is a Nigerian company or the owner of
beneficial interest in the shares or comparable interest is resident in Nigeria
or the owner has a permanent establishment in Nigeria to which the shares
relates;
(h) a ship or aircraft used in international traffic is situated in Nigeria
where the owner is resident in Nigeria or the owner has a permanent
establishment in Nigeria to which the ship or aircraft relates;
Nigeria Tax Act, 2025 2025 No. 7 A 423
(i) interest or right in or over a ship or aircraft used in international traffic
is situated in Nigeria where the person entitled to the interest or right is
resident in Nigeria or has a permanent establishment in Nigeria to which the
interest or right relates;
(j) the situation of goodwill of a trade, business or professional asset is at
the place where the trade, business or profession is carried on;
(k) patents, trademarks or designs are situated where they are registered,
and if registered in more than one register, where each register is situated;
(l) copyright, franchises, rights or licences to use any copyright material,
patent, trademark, or design are situated in Nigeria where they, or any rights
derived from them, are exercisable in Nigeria;
(m) a judgement debt is situated where the judgement is recorded; and
(n) notwithstanding paragraphs (k) and (l), incorporeal property including
digital assets are situated in Nigeria where the person who holds direct or
indirect beneficial ownership, control or interest over the right or property is
resident in Nigeria or has a permanent establishment in Nigeria to which the
property is connected.

Gains accruing to any person in respect of a disposal of shares by a Indirect
non-resident shall be a chargeable gain under this Act where the disposal transfer of
ownership of
results into a change –
companies or
assets
(a) in the ownership structure or group membership of any Nigerian
company; or
(b) of ownership of, title in, or interest in any asset located in Nigeria.

(1) This section has effect in respect to any policy of assurance or Life
contract for a deferred annuity on the life of any person. assurance
policies
(2) Chargeable gain shall not accrue on the disposal of an interest in, or
the rights under any such policy of assurance or contract, except where the
person making the disposal is not the initial beneficial owner and acquired the
rights or interests for a consideration in money or money's worth.
(3) Subject to subsection (2), the surrender of a policy of assurance or
the rights under a contract for a deferred annuity shall constitute a disposal of
the rights under the policy of assurance or contract for a deferred annuity, and
the amount of the consideration for the disposal of a contract for a deferred
annuity shall be the higher of the market value and the disposal proceeds.

(1) The rights of the insured under an insurance effected in the course Rights under
of a capital redemption business or industrial assurance business shall constitute policies of
insurance,
an asset which may yield a chargeable gain upon disposal.
other than
(2) The rights under any other policy of insurance, whether the risks life
assurance
insured relate to property or not, shall not constitute an asset on the disposal of
policies
A 424 2025 No. 7 Nigeria Tax Act, 2025
which a chargeable gain may accrue, except as may be expressly provided
under this Part.
(3) In this section –
(a) "capital redemption business" means the business of effecting and
carrying out contracts of insurance, whether effected by the issue of policies,
bonds or endowment certificates or otherwise, whereby, in return for one or
more premiums paid to the insurer a sum or a series of sums is to become
payable to the insured in the future, excluding life or industrial assurance
business;
(b) "industrial assurance business" means the business of effecting
and carrying out contracts of insurance in connection with any industrial
assurance whereby in return for one or more premiums paid to the insurer
a sum or a series of sums is to become payable to the insured in the future;
and
(c) "policy of insurance" does not include a policy of assurance on
human life.
Personal

(1) Sums not exceeding N 50,000,000 obtained by way of compensa-
injury tion or damages for any wrong or injury suffered by an individual in his person
or in his profession or vocation, including compensation for loss of office or
employment, wrong or injury for libel, slander or enticement shall not be
chargeable gains.
(2) Where the sum exceeds N 50,000,000, only the excess amount shall
constitute a chargeable gain.
(3) For the purposes of subsection (1) and (2), any person who pays
compensation for loss of office or employment to an individual is required, at
the point of payment of such compensation, to deduct and remit the tax due
under this section to the relevant tax authority.
(4) The tax so deducted shall be remitted within the time specified under
the Pay-As-You-Earn or Deduction of Tax at Source Regulations issued pur-
suant to the Nigeria Tax Administration Act, 2025.

(1) The gains accruing to an individual are exempt from tax in respect
private of the disposal of, or an interest in –
residences
(a) a dwelling-house or part of such dwelling-house; and
(b) land, other than land used for commercial purposes, immediately
adjoining the dwelling house up to a maximum of one acre.
(2) The exemption under this section shall be enjoyed once in the lifetime
of an individual.
(3) The consideration shall be apportioned where a person disposes of
only a part of a dwelling-house or a house used partly as dwelling place and
partly for carrying out a trade, business, profession or vocation.
Nigeria Tax Act, 2025 2025 No. 7 A 425

(1) A gain accruing on a disposal of an asset which is tangible movable Personal
property being personal chattels of an individual shall not be a chargeable gain chattels
if the total amount or value of the consideration for the disposal does not, in a
period of assessment, exceed N 5,000,000 or three times the annual national
minimum wage, whichever is higher.
(2) Where two or more assets, whether or not forming part of a set of
articles, are disposed by a person to the same person or to persons acting in
concert or to connected persons, whether on the same or different occasions,
the two or more transactions shall be treated as a single transaction disposing
of a single asset, but with any apportionments, where necessary.
(3) Where the disposal is part of a right or interest in, or over tangible
movable property, subsection (1) shall apply in relation to the asset as a whole,
taking the consideration as including the market value of what remains
undisposed of, in addition to the actual consideration.
(4) The provisions of this section shall apply to a gain accruing on a
disposal of two or more assets, not necessarily forming part of a set of articles
of any description, which are tangible movable properties in the same manner
as they apply in relation to a gain accruing on a disposal of an asset, or two or
more assets forming part of a set of articles.
(5) This section shall not apply to a disposal of currency of any description.

(1) A motor vehicle used solely for private or non-profit purposes Motor
shall not be an asset for the purposes of this Part. vehicles
(2) The exemption under this section shall be limited to not more than
two motor vehicles by an individual in any year of assessment.

(1) Where a person disposes by way of a gift, an asset acquired by Gifts
him by way of a gift or any other form of gift, not being an acquisition on a
devolution on death, the gains accruing from the disposal shall not be chargeable
gains.
(2) For the purpose of this section and section 36 (2) of this Act, an asset
is acquired or disposed of by way of gift where no consideration is paid or
received for the acquisition or disposal.

(1) Any property held in trust for – Assets held
in trust for
(a) a religious or charitable institution of a public character, charities
(b) any statutory or registered friendly society,
(c) any co-operative society registered under the co-operative societies
law of any State, or
(d) any trade union registered under the Trade Unions Act, Cap. T14
LFN, 2004
shall not be subject to the provisions of Chapter Two of this Act, provided
that the gain is not derived from the disposal of an asset acquired in connection
A 426 2025 No. 7 Nigeria Tax Act, 2025
with any trade or business carried on by the institution, society or trade
union, and the gain is applied solely for the purpose of the institution, society
or trade union.
(2) Where such property ceases to be subject of such trust –
(a) the trustees shall be treated as if they had disposed of, and immediately
re-acquired the property for a consideration equal to its market value, any
gain on the disposal shall be treated as not accruing to the institution or
society; and
(b) any gain accruing directly or indirectly on that disposal shall be treated
as having accrued to the trustees and shall be chargeable gains for the
purposes of Chapter Two of this Act.
PART IX – RATES OF TAX
Rates of tax 56. Tax shall be levied, for each year of assessment in respect of total
for compa-
profits of every company, in the case of –
nies
(a) a small company, at 0%; and
(b) any other company, at the rate of 30 per cent from the commence-
ment of this Act.
Effective Tax 57. (1) Notwithstanding any provision of this Act or any other enactment,
Rate where, in any year of assessment, the effective tax rate of a company is less
than 15%, such company shall recompute and pay an additional tax that makes
its effective tax rate equal to 15%.
(2) The provisions of this section shall apply to –
(a) a company that is a constituent entity of an MNE group; and
(b) any other company with an aggregate turnover of N 20,000,000,000
and above in the relevant year of assessment.
(4) For the purposes of this section –
"effective tax rate" means the rate produced by dividing the aggre-
gate covered tax paid by a company for a year of assessment by the
profits of the company; and
"profits" means the net profits before tax as reported in the audited
financial statement less 5% of depreciation and personnel cost for the
year.
Rates of tax

(1) Any property held in trust for – Assets held
in trust for
(a) a religious or charitable institution of a public character, charities
(b) any statutory or registered friendly society,
(c) any co-operative society registered under the co-operative societies
law of any State, or
(d) any trade union registered under the Trade Unions Act, Cap. T14
LFN, 2004
shall not be subject to the provisions of Chapter Two of this Act, provided
that the gain is not derived from the disposal of an asset acquired in connection
A 426 2025 No. 7 Nigeria Tax Act, 2025
with any trade or business carried on by the institution, society or trade
union, and the gain is applied solely for the purpose of the institution, society
or trade union.
(2) Where such property ceases to be subject of such trust –
(a) the trustees shall be treated as if they had disposed of, and immediately
re-acquired the property for a consideration equal to its market value, any
gain on the disposal shall be treated as not accruing to the institution or
society; and
(b) any gain accruing directly or indirectly on that disposal shall be treated
as having accrued to the trustees and shall be chargeable gains for the
purposes of Chapter Two of this Act.
PART IX – RATES OF TAX

(1) Notwithstanding any provision of this Act or any other enactment,
Rate where, in any year of assessment, the effective tax rate of a company is less
than 15%, such company shall recompute and pay an additional tax that makes
its effective tax rate equal to 15%.
(2) The provisions of this section shall apply to –
(a) a company that is a constituent entity of an MNE group; and
(b) any other company with an aggregate turnover of N 20,000,000,000
and above in the relevant year of assessment.
(4) For the purposes of this section –
"effective tax rate" means the rate produced by dividing the aggre-
gate covered tax paid by a company for a year of assessment by the
profits of the company; and
"profits" means the net profits before tax as reported in the audited
financial statement less 5% of depreciation and personnel cost for the
year.
Rates of tax

The income tax payable on the chargeable income of an individual,
for individu-
other than an individual earning the Minimum Wage in line with the Minimum
als
Act No. 8, Wage Act, in respect of each year of assessment, shall be as specified in the

(1) A development levy of 4% is imposed on the assessable profits of Develop-
all companies chargeable to tax under Chapters Two and Three of this Act, ment Levy
other than small companies and non-resident companies.
(2) The Service shall collect the levy and pay it into a special account
created for that purpose.
(3) The revenue accruing from the levy shall be distributed as follows –
(a) Tertiary Education Trust Fund – 50%;
(b) Nigerian Education Loan – 15%;
(c) National Information Technology Development Fund – 8%;
(d) National Agency for Science and Engineering Infrastructure – 8%;
(e) National Board for Technological Incubation –4%;
(f) Defence and Security Infrastructure Fund –10%; and
(g) National Cybersecurity Fund – 5%.
(4) The tax imposed under this Part shall not be levied on assessable
profits computed for the purposes of hydrocarbon tax.
(5) For the purpose of this section, every beneficiary agency and Fund in
subsection (3) shall be required to prepare and submit their income and
expenditure to the National Assembly for appropriation.
(6) The provisions of the Fourteenth Schedule shall apply for the purpose Fourteenth
of further allocation of the distribution in subsection (3)(f). Schedule
PART XI – SPECIALISED TRADE OR BUSINESS

Where a trade or business is carried on by an export processing or Export
Processing
export free zone entity, the provisions of the Second Schedule to this Act shall
and Export
apply.
Free Zone
entities
Second
Schedule

(1) An insurance business shall be taxed as a – Insurance
trade or
(a) general insurance company, whether proprietary or mutual, other business
than a life insurance company; or
(b) life insurance company:
Provided that the profits on which tax may be imposed for an insurance
business shall be in accordance with section 6 or 17 of this Act.
(2) The profits on which tax may be imposed, in the case of –
(a) a general insurance, shall be ascertained in accordance with the pro-
visions of subsection (3) as if the whole premium and investment incomes
A 428 2025 No. 7 Nigeria Tax Act, 2025
of the company were derived from Nigeria; and
(b) a life insurance, shall be ascertained in accordance with the provisions
of subsections (4) and (5) as if the whole investment and other incomes
were received in Nigeria and all the expenses and other outgoings of the
company were incurred in Nigeria.
(3) For a general insurance business, the profit on which tax may be
imposed shall be ascertained by taking the gross premium and other income
receivable, less reinsurance, and deducting from the balance so arrived at, a
reserve for unexpired risks, determined in accordance with subsection (9)(a)
and other deductions allowed under subsection (9)(b) and Chapter Two of this
Act.
(4) For a life insurance business, the profits on which tax may be imposed
shall be the investment income, and other income, less the management
expenses, including commission.
(5) Any amount distributed in any form as dividend from an actuarial
revaluation of unexpired risks or from any other revaluation shall be deemed to
be part of the total profits of a company engaged in life insurance business.
(6) The company shall provide the Service with full particulars of any
revaluation carried out, including a copy of the actuary's revaluation certificate,
not more than three months after an actuarial revaluation of unexpired risks or
any other revaluation has taken place.
(7) Where an insurance company carries on a life class and a general or
non-life class insurance business, the funds and books of accounts of one class
shall be kept separate from the other as though one class does not relate to the
other class, and the annual tax returns of the two classes of insurance businesses
shall be made separately.
(8) Each class of insurance shall be assessed separately as life insurance
assessment or non-life insurance assessment, and in respect of each class of
insurance business, where there are more than one type of insurance in the
same class, they form one type of business and the loss from one class shall
not be allowed against the income from another class of insurance business,
provided that the loss shall be available to be carried forward against the profits
from the same class of insurance business.
(9) An insurance company, other than a life insurance company, shall be
allowed to deduct from its premium the following reserves for tax purposes –
(a) reserve for unexpired risks, calculated on a time apportionment basis
of the risks accepted in the year ; and
(b) for outstanding claims and outgoings, an amount equal to the total
estimated amount of all outstanding claims and outgoings, provided that any
amount not utilised towards settlement of claims and outgoings shall be
added to the total profits of the following year.
Nigeria Tax Act, 2025 2025 No. 7 A 429
(10) An insurance company, in respect of its life insurance business, shall
be allowed to deduct the following from its investment income and other
incomes –
(a) an amount which makes a general reserve and fund equal to the net
liabilities on policies in force at the time of an actuarial valuation;
(b) an amount which is equal to 1% of gross premium earned or 10% of
net profits, whichever is greater, to a special reserve fund and accumulated
until it becomes the amount of the statutory minimum paid-up capital; and
(c) all allowable business outgoings.
(11) A reinsurance company shall be allowed to deduct the following
from its gross profit, to be credited to a general reserve fund –
(a) an amount not more than 50% of the gross profits of the reinsurer for
the year, where the general reserve fund is less than the statutory minimum
paid-up capital; or
(b) an amount not more than 25% of the gross profits of the reinsurer for
the year, where the fund is equal to, or exceeds the statutory minimum paid-
up capital.
(12) An insurance company that engages the services of an insurance
agent, a loss adjuster or an insurance broker shall include in its annual tax
returns, a schedule showing the name and address of that agent, loss adjuster
or insurance broker, the date their services were employed and terminated, as
applicable, and payments made to each such agent, loss adjuster or insurance
broker for the period covered by the tax returns.
(13) For the purposes of this section –
"gross premium" means the total premiums written, received and
receivable, excluding unearned premium and premiums returned to the
insured;
"gross income" means total income earned by a life insurance business
including all investment income, fees, commission and income from other
assets but excluding franked investment income, premiums received and
claims paid by re-insurers;
"investment income" for the purposes of taxation of a life insurance
company under this section means income derived from investment of
shareholders' funds;
"non-life insurance business" means general or other insurance
business, other than life insurance business; and
"other income", for the purposes of non-life insurance businesses, means
all the income of the non-life insurance business other than gross premium
and franked investment income.
A 430 2025 No. 7 Nigeria Tax Act, 2025

(1) Notwithstanding anything to the contrary in any other law, the
gaming trade income of lottery and gaming trade or business shall be charged to tax in
or business
accordance with the provisions of this Act.
(2) In determining the assessable profits of lottery and gaming trade or
business, the following deductions shall be allowed, in addition to other deductions
allowed under Chapter Two of this Act –
(a) any amount paid as winnings, prizes or similar payments from the
relevant Prize Fund;
(b) agency commission expenses incurred; and
(c) levies paid to relevant regulatory and government authorities as
contained in relevant federal or state laws.
(3) For the purposes of this section –
"gaming" includes gambling, wagering, video poker, roulette, craps, bingo,
slot or gaming machine, drawings or other games of chance conducted by
any person; and
"lottery" or "lotteries" includes any betting, game, scheme, arrangement,
system, plan, promotional competition or device for the distribution of prizes
by lot or chance, or as a result of the exercise of skill and chance or based
on the outcome of real or virtual sporting events, or any other game, scheme,
arrangement, system, plan, competition or device.

(1) Where under the provisions of the Investments and Securities
Collective
Investment Act, a mutual fund is established for the purpose of providing facilities for the
Scheme participation of the public, as beneficiaries under a trust, in profits or income
Act No. 2, arising from acquisition, holding, management or disposal of securities or any
other property, chapter two of this Act shall, in respect of the income arising to
the trustees of a collective investment, have effect as if the –
(a) trustees were a company whose business consists mainly in the making
of investments and the principal part of whose income is derived from it;
(b) rights of the unit holders were shares in the company; and
(c) income accruing to the trustees as is available for payment to the unit
holders were dividends on such shar es, and reference to a company in this
Act shall include a collective investment scheme.
(2) For the purpose of section 27 of this Act, the profits of an authorised
collective investment scheme, on which tax, may be imposed, shall be
ascertained by taking the income accruing to the trustees from all the
investments of the scheme and deducting there from sums disbursed as
management expenses, including remuneration for the managers.
(3) Where the trustees of a scheme receive a payment on which the
scheme suffers tax by deduction, not being franked investment income, the tax
Nigeria Tax Act, 2025 2025 No. 7 A 431
deducted shall constitute an advance payment of income tax and shall be set-
off against income tax assessment for that year of assessment in ascertaining
the tax payable by the mutual fund or scheme.
(4) The profit accruing to the trustees of a collective investment that is
available for payment to unit holders or for investment shall be deemed to be
dividends paid or payable by the trustees to the unit holders in proportion to
their rights, and shall be taxed in the hands of the unit holders.
(5) In this section –
"authorised collective investment" means a scheme that is authorised Act No. 2,
by the Securities and Exchange Commission under the Investment and 2025
Securities Act to carry on the business of dealing in a mutual fund scheme
or collective investment scheme;
"collective investment scheme" means any arrangement made for the
purpose of providing facilities for the participation of the public as
beneficiaries under a trust in profits or income arising from the acquisition,
holding, management or disposal of securities or any other property;
"scheme" means authorised collective investment;
trustee" under a collective investment scheme means the person in whom
the property for the time being subject to any trust created under the scheme
is or may be invested in accordance with the terms of the trust; and
"unit holder" means any investor, beneficiary or person who acquired
units in a scheme and who is entitled to a share of the investments subject to
the trusts of a scheme.

(1) Trade or business engaged in mining operations is subject to tax Mining
under the relevant provisions of Chapter Two of this Act. operations
(2) For the purposes of computing the assessable profits of a company
engaged in mining operations, any amount contributed to any fund, scheme or
arrangement approved by the relevant authority for the purposes of providing
for environmental protection, environmental remediation, mine rehabilitation,
land reclamation and mine closure shall be tax deductible:
Provided that the amount so contributed is cash-backed and invested in a
dedicated account or trust fund managed by independent trustees or funds.
(3) Royalty is imposed on any mineral obtained in the course of exploration Eighth
or mining operations at a rate prescribed under the Eighth Schedule to this Act, Schedule
subject to the relevant provisions of Nigeria Tax Administration Act, 2025, and
the royalty paid shall be tax deductible in determining the assessable profits
from the trade or business.
(4) The Service shall be the relevant tax authority for the administration
of the royalty imposed under this section.
A 432 2025 No. 7 Nigeria Tax Act, 2025
CHAPTER 3
TAXATION OF INCOME FROM PETROLEUM OPERATIONS
PART I – HYDROCARBON TAX, ASCERTAINMENT OF CHARGEABLE TAX,
ASCERTAINMENT OF CHARGEABLE PROFITS AND CONSOLIDATION FOR TAX
PURPOSES

(1) This Part shall apply to companies engaged in upstream petroleum
of this Part operations in the onshore, shallow water and deep offshore with licences and
leases under the Petroleum Industry Act.
(2) In this Part –
(a) hydrocarbon tax shall apply to crude oil as well as field condensates
and liquid natural gas liquids derived from associated gas and produced in
the field upstream of the measurement points; and
(b) hydrocarbon tax shall not apply to –
(i) associated natural gas, including gaseous natural gas liquids produced
in the field and contained in the rich gas, and non-associated natural gas,
(ii) condensates and natural gas liquids produced from non-associated
gas in fields or gas processing plants, provided the related volumes are
determined at the measurement points or at the exit of the gas processing
plant, regardless of whether the condensates or natural gas liquids are
subsequently commingled with crude oil, and
(iii) any condensates and natural gas liquids produced from associ-
ated gas at gas processing or other facilities downstream of the
measurement points.
(3) The costs of production of associated gas, upstream of the
measurement point shall be allocated to crude oil for the purposes of calculating
hydrocarbon tax, provided that capital and operating costs for wells solely
producing associated gas-cap gas shall not be allocated to crude oil, but shall
be claimed under Chapter Two of this Act.
(4) This Part shall not apply to a frontier acreage until it is reclassified
under section 68 (3) of the Petroleum Industry Act.
(5) For the purposes of determining royalties, condensates shall be treated
as crude oil and natural gas liquids as natural gas.
(6) Upstream petroleum operations shall in addition to hydrocarbon tax,
be subject to Chapter Two of this Act.

Subject to the provisions of section 65(2) of this Act, there is levied
Charge of
hydrocarbon upon the profits of any company engaged in upstream petroleum operations in
tax relation to crude oil, a tax to be known as hydrocarbon tax, which shall be
charged and assessed on its profits related to the operations for each account-
ing period and payable in accordance with this Part.
Nigeria Tax Act, 2025 2025 No. 7 A 433

(1) Subject to this Part and the relevant provisions of the Petroleum
Ascertain-
Industry Act, in relation to any accounting period, the crude oil revenue of a ment of
company for that period shall be the value of any chargeable oil adjusted to the crude oil
measurement points, based on the – revenue,
adjusted
profit,
assessable
profits
(a) proceeds of all chargeable oil sold by the company; and
Act No. 6,
(b) value of all chargeable oil disposed by the company. 2021
(2) For the purposes of subsection (1), the value of any chargeable oil
disposed, shall be regarded as the aggregate of the value of that crude oil
determined for royalties for all fields in accordance with this Act, relevant
provisions of the Petroleum Industry Act or any other applicable law.
(3) Subject to section 71(2) of this Act, the adjusted profits of an accounting
period shall be the profits of that period after the deductions and additions
under section 68 of this Act.
(4) The assessable profit of an accounting period shall be the adjusted
profit of that period after any deduction allowed by section 70 of this Act.
(5) The chargeable profits of an accounting period shall be the assessable
profits of that period after the deduction allowed by section 71 of this Act.

(1) In computing the adjusted profit of a company engaged in upstream
Allowable
petroleum operations related to crude oil for any accounting period, there shall deductions
be deducted expenses wholly and exclusively incurred during that period for
the following –
(a) rents incurred by the company for the period pursuant to a petroleum
mining lease or petroleum prospecting licence;
(b) all royalties incurred by the company during that period in respect of
crude oil and associated gas and where payments to the Federation Account
from a petroleum mining lease is related to production sharing, profit sharing,
risk service contracts or other contractual features under a model contract
and the company has incurred liability for such payments;
(c) expenses directly incurred for repair of plant, machinery or fixtures
employed for the purpose of carrying on production activities or for the renewal,
repair or alteration of production implement, utensils or articles so employed;
(d) an expenditure, tangible or intangible directly incurred in connection
with the drilling of the first exploration well and the first two appraisal wells in
the same field, whether the wells are productive or not, provided that subsequent
exploration wells, appraisal wells and other wells shall be treated as qualifying
drilling expenditure under Part II of the First Schedule to this Act and where a
deduction may be given under this section in respect of any such expenditure, First
that expenditure shall not be treated as qualifying drilling expenditure for the Schedule
purpose of Part II of First Schedule to this Act ;
A 434 2025 No. 7 Nigeria Tax Act, 2025
(e) any amount contributed to a fund, scheme or arrangement relating to
abandonment plan approved by the Commission for the purpose of
decommissioning and abandonment, provided that the surplus or residue of the
fund shall be subject to tax under this Part at the end of life of the field, where
such surplus is returned to the lessee ;
(f) all sums incurred by the company to the Federal Government or any
State or Local Government Council by way of levies, stamp duties and fees;
(g) costs of gas reinjection wells, which are re-injecting natural gas that
otherwise would be flared, subject to ratification by the Commission; and
Act No. 6, (h) any amount contributed to any fund, scheme or arrangement approved
by the Commission pursuant to the establishment of host communities'
development trusts under Chapter 3 of the Petroleum Industry Act,
Environmental Remediation Fund, Niger Delta Development Commission and
other similar contributions.
(2) Liability waived, released or recovered shall be treated under this
Part in accordance with section 193 of this Act.

Subject to this Part, for the purpose of ascertaining the adjusted profit
not allowed of a company in the accounting period from its upstream petroleum operations
applicable to crude oil, no deduction shall be allowed in respect of –
(a) expenditure for the purchase of information relating to the existence
and extent of petroleum deposits, other than for the acquisition of geophysical,
geological and geochemical data and information;
(b) expenditure incurred as a penalty, natural gas flare fees or imposition
relating to natural gas flare;
(c) financial or bank charges, arbitration and litigation costs, bad debts
and interest on borrowing;
(d) head office or affiliate costs, shared costs, research and develop-
ment costs or any other like shared indirect production costs;
(e) production bonuses, signature bonuses paid for the acquisition of, or
of rights in or over, petroleum deposits, bonuses or fees paid for renewing
petroleum mining lease or petroleum prospecting licence or marginal field or
fees paid for assigning rights to another party;
(f) tax inputted into a contract or an agreement on a net of tax basis and
paid by a company on behalf of the vendor or contractor;
(g) capital withdrawn or sum employed or intended to be employed as
capital;
(h) capital employed in improvements as distinct from repairs;
(i) sum recoverable under an insurance or contract of indemnity, except
an amount that is not recovered under the scheme;
Nigeria Tax Act, 2025 2025 No. 7 A 435
(j) rent of or cost of repairs to any premises or part of premises not
incurred for the purpose of those operations;
(k) amounts incurred in respect of any income tax, special tax,
development levy, profits tax or other similar taxes, whether charged within
Nigeria or elsewhere;
(l) the depreciation of any premises, buildings, structures, works of a
permanent nature, plant, equipment, machinery, furniture or fixtures;
(m) payment to provident, savings, widows and orphans or other society,
scheme or fund;
(n) any contribution to a pension, provident or other society, scheme or
fund for production staff which may be approved, with or without retrospective
effect, by the National Pension Commission subject to such general conditions
or particular conditions, in the case of the society, scheme or fund as the
Service may prescribe, provided that any sum received by or the value of
any benefit obtained by the company from any approved pension, provident
or other society, scheme or fund, in the accounting period of that company
shall, for the purpose of section 68 (2) of this Act, be treated as income of
the company for that accounting period;
(o) all customs duties;
(p) any expense on which Value Added Tax is due under this Act but not Sixth
charged, or in the case of imported items, any expense on which the applicable Schedule
import duty or levy was not paid; and
(q) costs under paragraph 2(2)(c) of the Sixth Schedule to this Act.

(1) The assessable profits for each company or petroleum mining Assessable
lease for any accounting period shall be the amount of the adjusted profit of profits and
losses
that period after the deduction of the amount of any loss incurred by that
company during any previous accounting period.
(2) The assessable profit shall be determined separately for each of the
two classes of chargeable tax identified in section 72 (a) and (b) of this Act.
(3) The loss referred to in subsection (1) shall be deducted to the extent
possible from the amount of the adjusted profits of the accounting period
immediately succeeding the accounting period in which the loss was incurred,
and in subsequent accounting periods, until the loss is fully recouped.
(4) Within five months after the end of any accounting period of a company,
or within such further time as the Service may permit in writing, the company
may elect in writing that a deduction or any part to be made under this section
shall be deferred to and be made in the succeeding accounting period, and may
so elect in any succeeding accounting period.
A 436 2025 No. 7 Nigeria Tax Act, 2025

(1) The chargeable profits of a company for any accounting period
profits and shall be the amount of the assessable profits of that period after the deduction
allowances
of any amount to be allowed in accordance with the provisions of this section
as follows –
First (a) the aggregate amount of capital allowances due to the company un-
Schedule der the provisions of Part II of First Schedule to this Act for the accounting
period;
Sixth (b) the aggregate amount of all production allowances due to the com-
Schedule
pany under the provisions of the Sixth Schedule to this Act for the accounting
period; and
First (c) in the case of acquisition costs of petroleum rights, the value of the
Schedule rights and the value of the assets acquired shall be reported separately to the
Service, provided that the value of the rights shall be eligible for annual allow-
ance of 20% per annum until it is fully written off and the value of the assets
shall be depreciated based on the applicable depreciation rates for the respec-
tive assets under Part II of the First Schedule to this Act.
Sixth (2) In determining the chargeable profit, the total cost shall not exceed
Schedule
the cost-price ratio as determined in the Sixth Schedule to this Act.
(3) The chargeable profits and allowances shall be determined sepa-
rately for the two classes of assessable profits under section 72 (a) and (b) of
this Act.
First (4) Where Value Added Tax is due under this Act but not charged on an
Schedule asset, or in the case of an imported item, the applicable import duty or levy was
not paid, the relevant expenditure shall not be eligible as a qualifying capital
expenditure under the provisions of Part II of First Schedule to this Act.

The chargeable hydrocarbon tax for any accounting period of a com-
hydrocarbon pany shall be a percentage of the aggregated chargeable profit for that period
tax
and it shall be –
(a) 30% of the profit from crude oil for petroleum mining leases selected
under section 93 (6) (b) and (7) (b) of the Petroleum Industry Act with
respect to onshore and shallow water areas; and
Act No. 6, (b) 15% of profit from crude oil for onshore and shallow water and for
petroleum prospecting licences selected under section 93 (6) (a) and (7) (a)
of Petroleum Industry Act.

(1) Where, for any accounting period of a company, there is a sale of
chargeable chargeable oil between connected persons, or disposal of chargeable oil be-
tax payable
tween connected or unconnected persons, and the amount of the chargeable
in certain
hydrocarbon tax for that period, calculated in accordance with the provisions
circum-
stances of this Part other than this section, is less than the amount prescribed in sub-
section (2), the company shall pay an additional amount of chargeable hydro-
Nigeria Tax Act, 2025 2025 No. 7 A 437
carbon tax for that period equal to the difference between those two amounts.
(2) The amount referred to in subsection (1) is, for any accounting period
of a company, the amount which the chargeable hydrocarbon tax for crude oil
for that period, calculated in accordance with this Part, shall be, if the reference
in section 67 (1) (a) of this Act to the proceeds of sale were a reference to the
amount obtained by multiplying the number of barrels of that crude oil determined
at the measurement point by the fiscal oil price per barrel.
(3) For the purpose of subsection (2), the Commission shall establish the Act No. 6,
fiscal oil price at each measurement point on an export parity basis under 2021
paragraph 8 (1) and (2) of the Seventh Schedule of the Petroleum Industry
Act and the total value of the chargeable oil for a company shall be the sum of
the multiplications of volume and fiscal oil price at all measurement points as
established by the Commission.
(4) The whole of any additional chargeable hydrocarbon tax for crude oil
and associated gas payable by a company under this section for any accounting
period shall be paid concurrently with the final instalment of the chargeable
hydrocarbon tax payable for that period.
(5) Where there is no fiscal oil price established for a crude oil stream,
the Commission shall establish fiscal oil price for such stream and the fiscal oil
price per barrel established shall bear a fair and reasonable relationship –
(a) to the established fiscal oil price of Nigerian crude oil streams of
comparable quality and specific gravity; or
(b) where there are no such Nigerian crude oil streams of comparable
quality and specific gravity, it shall bear a fair and reasonable relationship to
the official selling prices at main international trading centres for crude oil
of comparable quality and gravity,
due regard being had in either case to freight differentials and other relevant
factors.
(6) Notwithstanding any other provision in this Part, where crude oil,
which in relation to a particular company is its chargeable oil, is sold or disposed
by another company, the crude oil shall for the purpose of this section be
deemed to be sold or disposed by that particular company.

Where a company has not commenced the production and sale or Pre-
disposal of chargeable oil, all costs incurred wholly and exclusively for the production
cost
purpose of coming into upstream petroleum operations, subject to sections 68
and 69 of this Act, shall upon commencement of production and sale or disposal
of chargeable oil be deemed to have incurred a qualifying pre-production capi-
tal expenditure which shall be amortised in line with paragraphs 2 and 14 of First
Part II of First Schedule to this Act. Schedule
A 438 2025 No. 7 Nigeria Tax Act, 2025

The sale or transfer of a trade or business of upstream petroleum
business sold operations carried on in Nigeria by a company to another company shall be
or trans-
treated in accordance with section 190 of this Act.
ferred
n

(1) A company engaged in upstream petroleum operations across
tion of costs
terrains shall be allowed to consolidate costs and incomes for the purpose of
and revenue
income tax under Chapter Two of this Act.
(2) A company engaged in upstream petroleum operations related to crude
oil across terrains shall be allowed to consolidate costs and revenue for the
purposes of hydrocarbon tax, only across assets in which it holds licences and
leases in accordance with the two categories of chargeable tax stipulated in
section 72 of this Act

(1) A person, other than a company, who engages in upstream petroleum
Partnerships
operations either on his own account or jointly with any other person or in
partnership with any other person with a view to sharing the profits arising
from the operations, commits an offence.
(2) Where the person referred to in subsection (1) has benefitted from
any profits on upstream petroleum operations, the person shall be subject to
hydrocarbon tax and income tax under section 78 of this Act on the profits and
shall pay a penalty provided under the Nigeria Tax Administration Act, 2025.
(3) Where two or more companies are engaged in upstream petroleum
operations either in partnership, in a joint venture or in concert under any
scheme or arrangement, tax shall be charged and assessed on them in
accordance with subsection (4).
(4) The apportionment of any profits, outgoings, expenses, liabilities,
deductions, qualifying expenditure and the tax chargeable upon each company
shall be in line with the equity interest of the parties under a jointly executed
agreement that will be made available to the Service and where no jointly
executed agreement is made available, the Commission shall advise the Service
of the approved equity interest of the parties and it shall be binding on the
parties.
(5) Subject to this Part, where two or more companies are engaged in
upstream petroleum operations either in partnership, in a joint venture or in
concert under any scheme or arrangement, the Service may make regulations,
for the ascertainment of tax to be charged or assessed upon each company so
engaged.
(6) Regulations made under subsection (5) may make provisions –
(a) with respect to apportionment of any profits, outgoings, expenses,
liabilities, deductions, qualifying expenditure and tax chargeable upon each
company ;
Nigeria Tax Act, 2025 2025 No. 7 A 439
(b) for the computation of any tax as if the partnership, joint venture,
scheme or arrangement were carried on by one company and apportion the
tax between the companies concerned ;
(c) to accept other basis of ascertaining the tax chargeable upon each of
the companies; or
(d) which have regard to any circumstances whereby the operations are
partly carried on for any company by an operating company whose expenses
are reimbursed by those companies.
(7) Regulations made under this section may be of general application
for the purpose of this section and this Part or for a class of arrangement or for
a particular application to a specific partnership, joint venture, scheme or
arrangement.
(8) The effect of regulations made under this section shall not impose a
greater burden of tax upon any company so engaged in any partnership, joint
venture, scheme or arrangement than would have been imposed upon that
company under this Part, if all things enjoyed, done or suffered by such
partnership, joint venture, scheme or arrangement had been enjoyed, done or
suffered by that company in the proportion in which it enjoys, does or suffers
those things under or by virtue of that partnership, joint venture, scheme or
arrangement.

(1) Sections 78 to 88 of this Act and the provisions of chapter two of Income tax
this Act shall apply to any company, concessionaire, licensee, lessee, contractor on petroleum
operations
or subcontractor involved in the upstream, midstream or downstream petroleum
operations under the Petroleum Industry Act – Act No. 6,
2021
(2) For the purpose of determining the value of chargeable crude oil or
chargeable gas, in relation to any accounting period, the crude oil and gas
revenue of a company for that period shall be the value of any chargeable oil
or chargeable gas adjusted to the measurement points, based on the –
(a) proceeds of all chargeable oil or gas sold by the company; and
(b) value of all chargeable oil or gas disposed by the company.
(3) In determining the income tax under Chapter Two of this Act –
(a) hydrocarbon tax is not deductible; and
(b) income chargeable to tax includes –
(i) all income of that period incidental to and arising from any one or
more of its petroleum operations, and
(ii) gains arising from the disposal of assets accruing to the company
in any accounting period, ascertained in accordance with the relevant
provisions of Part VIII of Chapter two of this Act.
A 440 2025 No. 7 Nigeria Tax Act, 2025

(1) Subject to sections 142 (2) and 197(2) of the Petroleum Industry
and use of Act, a person intending to be involved in more than one stream, that is, upstream,
separate
midstream or downstream petroleum operations, shall register and use a separate
company for
company for each stream of petroleum operations under the Petroleum Industry
each stream
Act:
of petroleum
operations
Provided that, for companies with petroleum mining leases selected un-
Act No. 6,
der section 93 (6) (b) and (7) (b) of the Petroleum Industry Act, no stamp
2021
duties, value added tax or income tax on chargeable gains shall be levied by
the Government on such segregation.
(2) For strategic projects in the upstream petroleum operations that seek
to produce oil and natural gas to be processed or refined to finished petroleum
products, and supplied in wholesale solely to the domestic market, such projects
shall have the option to be established as an integrated strategic project (ISP),
whereby the capital investment in the associated midstream petroleum operations
as defined under the Petroleum Industry Act, can be consolidated with the
upstream petroleum operations for purposes of tax.
(3) Where an ISP option is elected, the following provisions shall apply –
(a) arm's length transfer prices shall be established to fiscalise the
hydrocarbons transferred from the upstream petroleum operations to the
midstream petroleum operations; and
(b) capital investment in the midstream petroleum operations consoli-
dated with upstream petroleum operations shall not be represented for capital
allowance when fiscalising the income from midstream petroleum operations.

(1) In addition to the economic development tax incentive that may
relating to be granted under Part II of Chapter Eight of this Act, investors in gas pipeline
gas
shall be granted a tax-free period of five years at the expiration of the economic
development incentive certificate.
(2) Natural gas transferred or disposed from the upstream to the
midstream or downstream shall be subject to tax under the relevant provisions
of Chapter Two of this Act.
(3) Natural gas liquids and liquid petroleum gases derived from natural
gas shall be subject to income tax under the relevant provisions of Chapter
Two of this Act.

(1) Acquisition costs of petroleum rights shall be eligible for annual
for the
allowance at the rate of 20% until the cost is fully written off.
purposes of
income tax
on
petroleum (2) Capital allowance for other assets shall be granted as follows –
operations
(a) upstream petroleum operations assets shall be in accordance with
First
Part II of the First Schedule to this Act; and
Schedule
Nigeria Tax Act, 2025 2025 No. 7 A 441
(b) midstream and downstream operations shall be in accordance with First
Schedule
Part I of the First Schedule to this Act.

(1) For the purpose of determining income tax, section 20 of this Act Expense
deductibility
shall be read in conjunction with the provisions of this subsection as regards
the followings –
(a) all rents and royalties the liability for which was incurred by the
company during that period in respect of crude oil sold, condensate sold and
natural gas sold or delivered or disposed of in any other commercial manner
and where a petroleum mining lease includes payments to the Federation
Account related to production sharing, profit sharing, risk service contracts
or other contractual features and the company has incurred liability for such
payments and such payments were made;
(b) any amount contributed to any fund, scheme or arrangement approved
by the Commission or Authority for the purpose of providing for –
(i) abandonment and decommissioning,
(ii) petroleum host communities development trust, or
(iii) environmental remediation; and
(c) any other deduction as may be prescribed by the Minister by order
published in the Official Gazette.
(2) For the purpose of determining income tax, section 21 of this Act
shall be read in conjunction with the provisions of this subsection as regards
the followings –
(a) any expenditure for the purchase of information relating to the existence
and extent of petroleum deposits, other than for the acquisition of geological,
geophysical and geochemical data or information;
(b) any expenditure incurred as a penalty including natural gas flare fees
or any such imposition relating to natural gas flare;
(c) production bonuses, signature bonuses paid for the acquisition of, or
of rights in or over, petroleum deposits, signature bonuses or fees paid for
renewing petroleum mining lease or petroleum prospecting licence or fees
paid for assigning rights to another party including for marginal fields; and
(d) any tax inputted into a contract or an agreement on a net of tax basis
and paid by a company on behalf of the vendor or contractor.

Any company involved in upstream petroleum operations shall apply Basis period
for income
the accounting periods established for hydrocarbon tax on an actual year basis
tax on
for its income tax.
petroleum
operations

(1) Where, for any accounting period of a company, there is a sale of Additional
chargeable oil or chargeable gas between connected persons, or disposal of income tax
payable in
chargeable oil or chargeable gas between connected or unconnected persons,
certain
circum-
stances
A 442 2025 No. 7 Nigeria Tax Act, 2025
and the amount of the income tax chargeable for that period, calculated in
accordance with the provisions of sections 78 to 83, and Chapter Two of this
Act, is less than the amount prescribed in subsection (2), the company shall be
liable to pay an additional amount of chargeable tax for that period equal to the
difference between those two amounts.
(2) The amount referred to in subsection (1) is, for any accounting period
of a company, the amount which the chargeable tax for crude oil or gas for
that period, calculated in accordance with this section and chapter two of this
Act shall be, if the reference in section 78 (2)(a) and (b) of this Act, to the
proceeds of sale or disposal were a reference to the amount obtained by
multiplying the number of barrels of that crude oil or gas determined at the
measurement point by the fiscal oil price per barrel or fiscal gas price per
MMBtu.
(3) For the purposes of subsection (2), the relevant sum per barrel of
crude oil, condensate or gas per MMBtu by a company is the fiscal oil price or
fiscal gas price applicable to that crude oil or gas as may be established by the
Commission.
(4) The whole of any additional chargeable tax for crude oil or chargeable
gas payable by a company under this section for any accounting period shall
be paid concurrently with the final instalment of the chargeable tax payable for
that period.
(5) Where there is no fiscal oil price or fiscal gas price established for a
crude oil stream or gas, the Commission shall establish fiscal oil price or fiscal
gas price for such stream and the fiscal oil or gas price established shall bear
a fair and reasonable relationship -
(a) to the established fiscal oil or gas price of Nigerian crude oil streams
or gas of comparable quality and specific gravity; or
(b) where there are no such Nigerian crude oil streams or gas of
comparable quality and specific gravity, it shall bear a fair and reasonable
relationship to the official selling prices at main international trading centres
for crude oil or gas of comparable quality and gravity,
due regard being had in either case to freight differentials and other relevant
factors.
(6) Notwithstanding any other provision in this Part, where crude oil or
gas, which in relation to a particular company is its chargeable oil or gas, is sold
or disposed by another company, the crude oil or gas shall for the purpose of
this section be deemed to be sold or disposed by that particular company.

(1) Notwithstanding the provisions of this Act or any other law, the
Associated
provisions of this section shall apply to all Non-Associated Gas greenfield
gas greenfield
developments in onshore and shallow water terrains reaching first commercial
develop-
ments in gas production from the commencement of this Act to 1 January, 2029 –
onshore and
shallow
water
terrains
Nigeria Tax Act, 2025 2025 No. 7 A 443
(a) where the hydrocarbon liquids do not exceed 30 barrels per million
standard cubic feet, there shall be granted a gas production tax credit at the
rate of US$1.00 per thousand cubic feet or 30% of the fiscal gas price,
whichever is lower;
(b) where the hydrocarbon liquids exceed 30 barrels per million standard
cubic feet but do not exceed 100 barrels per million standard cubic feet,
there shall be granted a gas production tax credit at the rate of US$0.50 per
thousand cubic feet or 30% of the fiscal gas price, whichever is lower;
(c) where the hydrocarbon liquids exceed 100 barrels per million standard
cubic feet, the incentives under subsections (a) and (b) shall no longer apply;
(d) the gas tax credit granted by this section shall apply on Non-Associated
Gas sales for 10 years only, beginning from the date of attaining first gas
production; and
(e) at the expiration of the 10 years referred to in subsection (1)(d), gas
production allowance shall be granted at the respective rates set out in
subsection (1)(a) and (b), provided that gas production tax credit and gas
production allowance shall not be granted in respect of gas production of
the same period.
(2) In the case of all other Non-Associated Gas Greenfield projects with
first commercial gas production after 1 January, 2029, gas production allow-
ance shall be granted at US$0.50 per thousand cubic feet or 30% of the fiscal
gas price, whichever is lower, provided that the hydrocarbon liquids do not
exceed 100 barrels per million standard cubic feet.
(3) The gas production tax credit that can be recouped in any year shall
not exceed the tax payable on the field(s) for that year on that income, subject
to the payment of any minimum tax where applicable.
(4) Unrecouped tax credit in one year may be carried forward for a
maximum of three years.
(5) The fiscal gas price for calculating gas production tax credit and gas
production allowance shall be the same price used for determining royalties.
(6) The provisions of this section shall apply to oil mining leases and
petroleum mining leases.
(7) Where first gas production cannot be achieved due to force majeure,
such as natural disasters or acts of terrorism, the timelines and obligations
stipulated in subsection (1) may be suspended, subject to approval by the
Commission, until such time as the force majeure ceases to exist.
(8) The Commission shall certify the applicable hydrocarbon liquid ratios
for the purposes of ascertaining appropriate gas production tax credit or gas
production tax allowance.
A 444 2025 No. 7 Nigeria Tax Act, 2025
(9) The incentives under this section shall not apply to any company that
has claimed Associated Gas Framework Agreement incentives for the same
Non-Associated Gas Greenfield project.
Provision

Notwithstanding section 233(1) of the Petroleum Industry Act, a
Relating to
provision made for decommissioning and abandonment fund shall not be
Decommis-
sioning and deductible for tax purposes, except –
Abandon-
ment of
Funds (a) the licensee or lessee deposit a minimum of 30% of the decommissioning
Act No. 6, and abandonment fund with a Nigerian Bank, in the form of an escrow
2021
account accessible by the Commission or Authority; and
(b) the Nigerian bank is accredited in accordance with the criteria for
accreditation for participation in the management of the fund, determined
by the Central Bank of Nigeria in collaboration with the Service.

(1) This Part and the provisions of the Petroleum Industry Act shall
application
not apply to holders of an oil prospecting licence or oil mining lease who do not
of this Part
enter into a conversion contract until the termination or expiration of the
and other
matters respective oil prospecting licence or oil mining lease.
Act No. 6,
2021
Act No. 6, (2) Notwithstanding subsection (1), the provisions of Chapter Two of this
2021
Act and paragraph 6 of the First Schedule to the Petroleum Industry Act shall
apply to licences and leases awarded to indigenous Nigerian companies on a
sole risk basis under the Petroleum Act, on which the Government has
successfully exercised its back-in rights prior to the effective date of the
Petroleum Industry Act, but any renewal of an oil mining lease shall be based
on the provisions of this Part and the Petroleum Industry Act.
(3) The fiscal provisions of this Part are the base terms that are applicable,
and the Commission may under section 74(2) of Petroleum Industry Act conduct
a licensing round whereby the bid parameter is a higher royalty, profit oil share
or other fiscal features in order to ensure that the Government receives the full
market value for each block.

(1) Fiscal stabilisation sections contained in a production sharing
stabilisation contract or other contracts entered into after the commencement of the
Petroleum Industry Act shall not be applicable to the fiscal provisions listed in
this Part, regardless of whether the changes in fiscal provisions affect the
contractor favourably or unfavourably, provided such changes in fiscal provi-
sion are being made in a manner that is not discriminatory to the petroleum
Act No. 6,
industry or the contractor.
(2) The respective fiscal provisions referred to in subsection (1) are –
Nigeria Tax Act, 2025 2025 No. 7 A 445
(a) generally applicable taxes, such as income tax, development levy,
value added tax, stamp duties, and deduction of tax at source;
(b) levies, taxes or payments to comply with modern principles in respect
of environment, labour laws, health and safety; and
(c) new taxes, levies or duties as may be prescribed by the Climate Act No. 11,
Change Act, or to implement Nigeria's commitments with respect to climate 2021
change under any international agreement.

(1) All production of petroleum, including production tests shall be Petroleum
royalty
subject to royalties as provided in the Seventh Schedule to this Act.
Seventh
Schedule
(2) The Service shall be the relevant tax authority for the administration of the Seventh
royalty imposed under this Part, and the Seventh Schedule to this Act. Schedule
PART II - PETROLEUM PROFITS TAX
IMPOSITION OF TAX AND ASCERTAINMENT OF CHARGEABLE PROFITS, ASCERTAIN-
MENT OF ASSESSABLE TAX AND OF CHARGEABLE TAX

(1) This Part shall apply to oil prospecting licences and oil mining Charge of
leases that are yet to convert under the provisions of the Petroleum Industry petroleum
profits tax
Act.
(2) Subject to Part I of Chapter Three of this Act and subsection (1), Act No. 6,
2021
there is levied upon the profits of each accounting period of a company engaged
in petroleum operations during that period a tax to be charged, assessed and
payable in accordance with the provisions of this Part.

(1) Subject to the provisions of this Part, the revenue of a company in Ascertain-
an accounting period shall be the aggregate of – ment of
profits,
(a) the proceeds of sale of all chargeable oil sold by the company in that
adjusted
period; profit,
assessable
(b) the value of all chargeable oil disposed by the company in that period;
profits and
(c) all income of the company of that period incidental to and arising chargeable
profits
from any one or more of its petroleum operations; and
(d) gains arising from the disposal of assets accruing to the company in
any accounting period, ascertained in accordance with the relevant provisions
of Part VIII of Chapter two of this Act which shall be taxable at the rate
provided under section 56 of this Act.
(2) For the purposes of subsection (1)(b), the value of any chargeable oil
disposed shall be taken to be the value of that oil in line with the applicable
legislation.
(3) The adjusted profit of an accounting period shall be the profits of that
period after the deductions allowed under section 92(1) of this Act and any
A 446 2025 No. 7 Nigeria Tax Act, 2025
adjustment to be made in accordance with the provisions of sections 92(2) and

(1) In computing the adjusted profit of a company for an accounting
allowed period from its petroleum operations, there shall be deducted all outgoings and
expenses wholly and exclusively incurred, during the period by the company
for the purpose of its operations, as follows –
(a) rents incurred by the company for that period in respect of land or
buildings occupied under an oil prospecting licence or an oil mining lease for
disturbance of surface rights or for any other like disturbance;
(b) all non-productive rents incurred by the company during that period;
(c) all royalties incurred by the company during that period in respect of
natural gas sold and actually delivered to the Nigerian National Petroleum
Company Limited, or sold to any other buyer or customer or disposed in any
other commercial manner;
(d) all royalties incurred by the company during the period in respect of
crude oil or of casinghead petroleum spirit won in Nigeria;
(e) customs or excise duty or other like charges in respect of machineries,
equipment and goods used in the company's petroleum operation incurred
by the company to the Federal Government of Nigeria during the period;
(f) any expense incurred for repair of premises, plant machinery, or fixtures
employed for the purpose of carrying on petroleum operations, or for the
renewal, repair or alteration of any implement, utensils or articles employed;
Third (g) interest incurred on money borrowed by such company where the
Schedule Service is satisfied that the interest was payable on capital employed in
carrying on its petroleum operations subject to the provisions of the Third
Schedule to this Act and the Transfer Pricing Regulations;
(h) any expenditure being intangible drilling costs directly incurred in
connection with drilling and appraisal of a development well;
First (i) any expenditure (tangible or intangible) directly incurred in connection
Schedule with the drilling of an exploration well and the next two appraisal wells in
the same field whether the wells are productive or not, provided that where
a deduction is made under this section in respect of any such expenditure,
that expenditure shall not be treated as qualifying drilling expenditure for the
purpose of Part III of the First Schedule to this Act ;
Act No. 2, (j) any contributions to pension, provident or other society, scheme or
fund, which may be approved, under the Pensions Reform Act, provided
Nigeria Tax Act, 2025 2025 No. 7 A 447
that the sum received by or the value of any benefit obtained by such
company, from any approved pension, provident or other society, scheme or
fund, in any accounting period of that company shall, for the purpose of
subsection (1)(c) of section 90 of this Act, be treated as income of the
company for that accounting period;
(k) customs and excise duties, stamp duties, or any other rate, fee or
other like charges, other than any tax on income, incurred by the company
during the period to the Federal Government, a State or Local Government;
(l) any amount contributed to a fund, scheme or arrangement approved
by the Commission for the purpose of decommissioning and abandonment,
subject to the production of the statement of account of the Decommissioning
and Abandonment Fund :
Provided that the surplus or residue of the fund after decommissioning and
abandonment of the field shall be subject to tax under this Part;
(m) debts directly incurred to the company and proved to the satisfaction
of the Service to have become bad or doubtful in the accounting period for
which the adjusted profits is being ascertained, notwithstanding that such
bad or doubtful debts were due and payable prior to the commencement of
that period, provided that –
(i) the debt was included as a profit from petroleum operations in the
accounting period in which they were incurred or advances made in the
normal course of carrying on petroleum operations not being advances
on account of any item under section 97 of this Act,
(ii) the deduction to be made in respect of a doubtful debt shall not
exceed that portion of the debt which is proved to have become doubtful
during that accounting period, and shall not include any amount deducted
under the provisions of this paragraph in determining the adjusted profit
of a previous accounting period, and
(iii) all sums recovered by the company during that accounting period
on account of amounts previously deducted in respect of bad or doubtful
debts shall be treated as income of the company for that period;
(n) development levy paid under section 59 of this Act ; and
(o) such other deductions as may be prescribed by any rule made under
this Part.
(2) Liability waived, released or recovered shall be treated under this
Part in accordance with section 193 of this Act.

(1) The following incentives shall apply to a company engaged in the Incentives
utilisation of associated gas – for
utilisation of
(a) investment required to separate crude oil and gas from the reservoir
associated
into usable products shall be considered as part of the oil field development;
gas
(b) capital investment on facilities or equipment to deliver associated gas
A 448 2025 No. 7 Nigeria Tax Act, 2025
in usable form at utilisation or designated custody transfer points shall be
treated for tax purposes, as part of the capital investment for oil development;
(c) capital allowances, operating expenses and basis of tax assessment
shall be subject to the provisions of this part and the tax incentives under the
revised memorandum of understanding.
(2) The incentives specified under subsection (1) shall be subject to the
following conditions –
(a) condensates extracted and re-injected into the crude oil stream shall
be treated as oil, but those not re-injected shall be treated under existing tax
arrangement;
(b) the company shall pay the minimum amount charged by the Minister
of Petroleum Resources for any gas flared by the company;
(c) the company shall, as far as practicable, keep the expenses incurred
in the utilisation of associated gas separate from those incurred on crude oil
operation and expenses that cannot be separated shall be allowable against
the crude oil income of the company under this Act;
(d) expenses identified as incurred exclusively in the utilisation of
associated gas shall be regarded as gas expenses and be allowable against
the gas income and profit to be taxed under Chapter Two of this Act;
(e) companies which invest in natural gas liquid extraction facilities to
supply gas in usable form to downstream projects, including aluminium smelter
and methanol, Methyl Tertiary Butyl Ether and other associated gas utilisation
projects shall benefit from the incentives;
(f) all capital investments relating to the gas-to-liquids facilities shall be
treated as chargeable capital allowance and recovered against the crude oil
income; and
(g) gas transferred from the natural gas liquid facility to the gas-to-liquid
facilities shall be at zero per cent tax and zero per cent royalty.
(3) Where a company has enjoyed any incentive under this section, the
company shall not claim similar incentive under any law in Nigeria regarding
the same investment or project, including economic development tax incentive
and gas pipeline investment incentive under section 80 of this Act.

All incentives granted in respect of investments in associated gas
of incentives
shall be applicable to investments in non-associated gas.
to utilisation
of non-
associated
gas

(1) Subject to the provisions of this Part, for the purposes of
Deductions
not allowed ascertaining the adjusted profit of any company for any accounting period
from its petroleum operations, no deduction shall be allowed in respect of –
Nigeria Tax Act, 2025 2025 No. 7 A 449
(a) any capital withdrawn or any sum employed or intended to be employed
as capital;
(b) any capital employed in improvements as distinct from repairs;
(c) any sum recoverable under an insurance or contract of indemnity;
(d) rent of or cost of repairs to any premises or part of premises not
incurred for the purposes of those operations;
(e) any amount incurred in respect of any income tax, profits tax or other
similar tax whether charged within Nigeria or elsewere;
(f) the depreciation of any premises, buildings, structures, work
s of a permanent nature, plant, equipment, machinery, furniture or fixtures;
(g) any payment to any pensions, provident, savings widows' and orphans'
or other society scheme or fund, except such payments as are allowed
under section 91 (1) (j) of this Act;
(h) customs duty on goods, including articles or any other thing, imported
by the company –
(i) or resale or for personal consumption of employees of the com-
pany, or
(ii) where goods of the same quality to those imported are produced in
Nigeria and are available for sale to the public at a price lower or equivalent
to the cost of the imported goods at the time the imported goods were
ordered by the company;
(i) any expenditure for the purchase of information relating to the existence
and extent of petroleum deposits;
(j) any qualifying expenditure for the purposes of Part III of the First First
Schedule
Schedule to this Act, and any expense or deduction in respect of a liability
incurred which is deductible under any other provision of this Act;
(k) any tax or penalty borne on behalf of another person; and
(l) any expense on which Value Added Tax is due under this Act but not
charged, or in the case of imported items, any expense on which the appli-
cable import duty or levy was not paid.
(2) Notwithstanding the provisions of section 92(1) of this Act, in computing
the adjusted profit of any company of any accounting period, deduction shall
not be allowed in respect of any sum incurred to a related party where the cost
is not in accordance with the Transfer Pricing Regulations.

Where a company engaged in petroleum operations is engaged in Exclusion of
the transportation of chargeable oil by ocean going oil-tankers operated by or certain
profits
on behalf of the company from Nigeria to another territory, adjustments shall
be made in computing an adjusted profit or a loss to exclude any profit or loss
attributable to such transportation.
A 450 2025 No. 7 Nigeria Tax Act, 2025

Where a company engaged in petroleum operations is engaged in Exclusion of
the transportation of chargeable oil by ocean going oil-tankers operated by or certain
profits
on behalf of the company from Nigeria to another territory, adjustments shall
be made in computing an adjusted profit or a loss to exclude any profit or loss
attributable to such transportation.
A 450 2025 No. 7 Nigeria Tax Act, 2025

(1) Subject to the provisions of this section, the assessable profits of
profits and a company for any accounting period shall be the amount of the adjusted profit
losses
of that period after the deduction of –
(a) the amount of any loss incurred by that company during any previous
accounting period; and
(b) in a case of a business restructuring, the amount of any loss which is
allowed for deduction by the new company under section 190 of this Act in
its trade or business during its first accounting period.
(2) The loss referred to in subsection (1) shall be deducted to the extent
possible from the amount of the adjusted profits of the accounting period
immediately succeeding the accounting period in which the loss was incurred,
and in subsequent accounting periods, until the loss is fully recouped.
(3) Subject to the approval of the Service, a company may, within five
months after the end of an accounting period, or such further time as the
Service may permit, elect in writing, that a deduction to be made under this
section, or part of the deduction, be deferred to succeeding accounting periods.

(1) The assessable tax for an accounting period of a company shall Assessable
be an amount equal to 85% of its chargeable profits of that period. petroleum
profits tax
(2) Where a company has not commenced a sale or bulk disposal of
chargeable oil under a programme of continuous production, its assessable tax
for an accounting period during which it has not fully amortised all its pre-
production capitalised expenditure, shall be 65.75% of the chargeable profits
for that period :
Provided that –
(a) the period of the tax rate under this subsection shall not be more than
five years, commencing from the first accounting period of the company,
notwithstanding any other incentive as may be granted to the company; and
(b) where a company is granted a licence or lease or acquires an interest
in an oil and gas asset that has enjoyed the provision of this subsection, the
company shall be subject to tax under the provision of subsection (1) from
its first accounting period.

(1) Where, for any accounting period of a company, there is a sale
Additional
of chargeable oil between connected persons, or disposal of chargeable oil chargeable
between connected or unconnected persons, and the amount of the charge- tax payable
in certain
able tax for that period, calculated in accordance with the provisions of this
circum-
Part other than this section, is less than the amount prescribed in subsection
stances
(2) , the company shall pay an additional amount of chargeable tax for that
period, equal to the difference between those two amounts.
(2) The amount referred to in subsection (1) is, for any accounting period
of a company, the amount which the chargeable tax for that period, calculated
in accordance with the provisions of this Part, shall be, if the reference in
section 91 (1) (a) and (b) of this Act to the proceeds of sale were a reference
to the amount obtained by multiplying the number of barrels of that crude oil
determined at the measurement point by the fiscal oil price per barrel.
(3) For the purpose of this section, the total value of the chargeable oil
for a company shall be the sum of the multiplications of volume and fiscal oil
price as established by the Commission at the measurement point.
A 452 2025 No. 7 Nigeria Tax Act, 2025
(4) The whole of any additional chargeable tax for crude oil payable by a
company under this section for any accounting period shall be payable
concurrently with the final instalment of the chargeable tax payable for that
period.
(5) Where there is no fiscal oil price established for a crude oil stream,
the Commission shall establish fiscal price for such stream and the fiscal oil
price per barrel established shall bear a fair and reasonable relationship –
(a) to the established fiscal oil price of Nigerian crude oil streams of
comparable quality and specific gravity; or
(b) where there are no such Nigerian crude oil streams of comparable
quality and specific gravity, it shall bear a fair and reasonable relationship to
the official selling prices at main international trading centres for crude oil
of comparable quality and gravity, due regard being had in either case to
freight differentials and other relevant factors.
(6) Notwithstanding any other provision in this Part, where a particular
company's chargeable oil is exported from Nigeria or sold locally by another
company, that chargeable oil for the purpose of this Part shall be deemed to be
exported from Nigeria or sold by that particular company.

(1) A person, other than a company, who engages in petroleum
operations either on his own account or jointly with any other person or in
partnership with any other person with a view to sharing the profits arising
from those operations commits an offence.
(2) Where the person referred to in subsection (1) has benefitted from
any profits on upstream petroleum operations, the person shall be subject to
tax under this Part on the profits and shall pay a penalty provided under Nigeria
Tax Administration Act, 2025.
(3) Where two or more companies are engaged in petroleum operations
either in partnership, in a joint venture or in concert under any scheme or
arrangement, the Service may make regulations for the ascertainment of the
tax to be charged and assessed on each company so engaged.
(4) Such regulations may –
(a) modify the provisions of this Part in such manner as the Service may
deem fit;
(b) provide for the apportionment of any profits, outgoings, expenses,
liabilities, deductions, qualifying expenditure and the tax chargeable on each
company;
(c) provide for the computation of any tax as if the partnership, joint
venture, scheme or arrangement were carried on by one company and
apportion that tax between the companies concerned;
Nigeria Tax Act, 2025 2025 No. 7 A 453
(d) accept other basis of ascertaining the tax chargeable on each of the
companies, which may be put forward by those companies ; or
(e) contain provisions which have regard to any circumstance whereby
such operations are partly carried on for the companies by an operating
company whose expenses are reimbursed by those companies.
(5) Regulations made under this section may be of general application
for the purposes of this section and this Part or of particular application to a
specified partnership, joint venture, scheme or arrangement.
(6) The regulations made under this section shall not impose a greater
burden of tax on any company engaged in any partnership, joint venture, scheme
or arrangement than would have been imposed on that company under this
Part if all things enjoyed, done or suffered by such company had been enjoyed,
done or suffered by the company in the proportion in which it enjoys, does or
suffers those things under that partnership, joint venture, scheme or
arrangement.
PART III – DEEP OFFSHORE AND INLAND BASIN
PRODUCTION SHARING CONTRACTS

Notwithstanding anything to the contrary contained in this Act or Production
any other law, the provisions of this Part shall apply to deep offshore and sharing
inland basin production sharing contracts that are yet to convert under the contracts
provisions of the Petroleum Industry Act, or have been renegotiated in
Act No. 6,
accordance with the provisions of the Petroleum Industry Act.
2021

The duration of an oil prospecting licence relating to production Duration of
sharing contracts in the deep offshore and inland basin shall be determined by oil prospect-
ing licence
the Minister charged with responsibility for matters relating to petroleum and
shall be for a minimum period of five years and not exceeding ten years.

(1) The petroleum profits tax payable under a production sharing Determina-
contract shall be determined in accordance with Part II of chapter three of this tion of
petroleum
Act, provided that the petroleum profits tax rate applicable to the contract area
profits tax
as defined in the production sharing contracts shall be 50% of chargeable
profits for the duration of the production sharing contracts.
(2) Nothing contained in this Part shall be construed as having exempted
any holder or contractor from the payment of any other tax, duty or levy
imposed by any Federal, State or Local Government, or Area Council Authority.

Where a holder and a contractor have incurred any qualifying capital Determina-
expenditure wholly and exclusively for the purposes of petroleum operations tion of
investment
carried out under the terms of a production sharing contract in the deep offshore
tax allow-
or inland basin, the parties shall be entitled to investment tax allowance at a
ance
A 454 2025 No. 7 Nigeria Tax Act, 2025
rate of 50% of the qualifying expenditure in accordance with the provisions of
existing applicable legislation for the accounting period in which that asset was
first used for the purposes of such operations.

Royalty shall be determined and payable in accordance with the
payable in
provisions of the Seventh Schedule to the Petroleum Industry Act.
respect of
deep offshore
production
sharing
contracts
Act No. 6,
2021
Computation

Computation of estimated and final petroleum profit tax shall be
of petroleum
profits tax made in the US dollars on the basis of the US dollar returns filed.

Computation of estimated and final petroleum profit tax shall be
of petroleum
profits tax made in the US dollars on the basis of the US dollar returns filed.
Allocation of 108. Royalty oil shall be allocated to the Commission or the holder, in
royalty oil
such quantum as shall generate an amount equal to actual royalty payable
during each month and the concession rental payable annually in accordance
with the production sharing contract terms.

(1) Cost oil shall be allocated to the contractor in such quantum as
cost oil
shall generate an amount sufficient for the recovery of operating costs in oil
prospecting licences as defined in the production sharing contract and any oil
mining leases derived therefrom.
(2) All operating costs shall be recovered in US Dollars through cost oil
allocations in accordance with the terms of the production sharing contract.

Tax oil shall be allocated to the Commission or the holder, in such
tax oil quantum as shall generate an amount equal to the actual petroleum profit tax
liability payable during each month.

Profit oil, being the balance of available crude oil after deducting
profit oil royalty oil, tax oil and cost oil, shall be allocated to each party in accordance
with the terms of the production sharing contract.
Payment 112. (1) The holder shall pay all royalty, concession rentals and petroleum
royalty
profits tax on behalf of itself and the contractor out of the allocated royalty oil
and tax oil.
(2) The Service shall issue separate tax receipts in the names of the
holder and the contractor for the respective amounts of petroleum profit tax
paid on behalf of the holder and contractor in accordance with the terms of the
production sharing contract.
Chargeable
tax petro- 113. The chargeable tax on petroleum operations in the contract area
leum under the production sharing contracts shall be split between the holder and
operations
Nigeria Tax Act, 2025 2025 No. 7 A 455
the contractor in the same ratio as the split of profit oil as defined in the
production sharing contract between them.

(1) The holder shall pay all royalty, concession rentals and petroleum
royalty
profits tax on behalf of itself and the contractor out of the allocated royalty oil
and tax oil.
(2) The Service shall issue separate tax receipts in the names of the
holder and the contractor for the respective amounts of petroleum profit tax
paid on behalf of the holder and contractor in accordance with the terms of the
production sharing contract.

The chargeable tax on petroleum operations in the contract area
leum under the production sharing contracts shall be split between the holder and
operations
Nigeria Tax Act, 2025 2025 No. 7 A 455
the contractor in the same ratio as the split of profit oil as defined in the
production sharing contract between them.

(1) The realisable price as defined in the production sharing contract Use of
established by the holder in accordance with the provisions of the production realiable
price in
sharing contract, shall be used to determine the amount payable on royalty and
determining
petroleum profits tax in respect of crude oil produced and lifted under the
royalty and
production sharing contract. petroleum
(2) The parameters for new crude oil streams produced from the con-
tract area shall also be determined in accordance with the provisions of the
production sharing contract.

The holder shall make available to the contractor copies of the receipts Submission
issued by the Service bearing the names of each party as defined in the of receipts
production sharing contract in accordance with each party's tax oil allocation
for the payment of petroleum profits tax under the provisions of the production
sharing contract.

The relevant provisions of all existing laws, including the Petroleum Adaptation
Act and Part II of Chapter Three of this Act shall be read with such modifications of laws
Cap. P10,
as to bring them into conformity with the provisions of this Part.
LFN, 2024

The Minister charged with responsibility for matters relating to Review of
petroleum shall cause the Commission to call for a review of production sharing the
production
contracts every eight years.
sharing
contract
PART IV - MISCELLANEOUS PROVISIONS

(1) The Service shall administer royalties payable under this Act in Administra-
tion of
accordance with the provisions of the Nigeria Tax Administration Act, 2025.
royalties
(2) Notwithstanding any other provision of this Act and any other law the
Commission shall account for all royalties due within the ten-year period im-
mediately preceding the commencement of this Act and the Service shall have
the authority to verify the records provided.
Interpreta-

In this Part -–
tion
"accounting date" means the date on which a company usually prepares
its accounting statement;
"accounting period" in relation to a company engaged in upstream
petroleum operations, means-
(a) a period of one year commencing from 1 January and ending on 31
December of the same year ,
(b) any shorter period commencing on the day the company first makes
A 456 2025 No. 7 Nigeria Tax Act, 2025
a sale or bulk disposal of chargeable oil, domestic, export or both, and ending
on 31 December of the same year , or
(c) any period of less than a year being a period commencing from 1
January of any year and ending on the date in the same year when the
company ceases to engage in petroleum operations,
and any dispute with respect to the date of the first sale of chargeable oil
above or the date on which the company ceases to engage in petroleum
operations shall be determined by the Minister responsible for Petroleum
Resources;
"adjusted profits" means adjusted profit as stated in sections 67 and 91
of this Act;
"aggregate gas price" means the gas price determined under section
167(4) of Petroleum Industry Act;
"appraisal well" means a well that, in the opinion of the Commission, is
aimed at determining the size, distribution, characteristics and commerciality
of a petroleum discovery;
"assessable profit" means assessable profit as stated in sections 67 and

(1) Where, in any year of assessment, any part of the income or
relief of profit of a resident of Nigeria, derived from outside Nigeria, has been charged
double to tax in the source country, and that income or profit is also chargeable to tax
taxation
in Nigeria, the tax paid outside Nigeria may be allowed as a credit against the
tax payable in Nigeria.
(2) The credit to be allowed in subsection (1) shall be the lower of the –
(a) Nigerian tax, other than taxes under Chapter Three of this Act,
attributable to the foreign income or profit; and
(b) amount of tax paid in the source country.
(3) The Nigerian tax under subsection (2) (a) attributable to the foreign
income or profit shall be the proportion of the foreign income to total income,
multiplied by the Nigerian tax.

(1) Where the Government of the Federal Republic of Nigeria
Double
taxation enters into an agreement with a treaty partner for the purpose of providing
agreement relief from double taxation in relation to tax imposed under this Act, the agree-
ment shall have effect upon ratification or domestication by the National As-
sembly.
(2) Relief from double taxation shall be in respect of income tax paid
under the laws of a treaty partner against income taxes imposed under this
Act.
(3) Where an agreement has taken effect, any obligation as to secrecy in
Nigeria Tax Administration Act, 2025 or any other law in Nigeria shall not
prevent the disclosure of any information required to be disclosed under the
agreement to an authorised officer of a treaty partner.
(4) The Minister may make rules for implementing the provisions of any
agreement under this section.
(5) For the purposes of providing relief in Nigeria from double taxation,
all extant double taxation agreements are deemed to have been made under
the provisions of this section and shall apply throughout Nigeria with effect
from 1 January of the year immediately following the date the agreement
entered into effect.
Nigeria Tax Act, 2025 2025 No. 7 A 465
(6) The agreement in subsection (1) shall be for the purpose of elimination
of double taxation, without creating opportunities for non-taxation or reduced
taxation through tax evasion, avoidance or other forms of abuse, including
treaty-shopping arrangements aimed at obtaining reliefs provided in the
agreement for the indirect benefit of residents of any other country or territory
that is not part of the agreement.
(7) For the purposes of the agreement referred to in subsection (1), a
non-resident may benefit under the agreement where the person is a resident
of the relevant treaty partner and the beneficial owner of the income for which
the benefit is being claimed.
(8) Nothing in this section shall be construed to allow a relief in respect
of an additional tax paid for the relevant tax year under this Act or the domestic
legislation of a treaty partner in conformity with the global minimum tax rules
as it relates to a permanent establishment situated in the treaty partner.

(1) Relief from double taxation under an agreement referred to in
Method of
section 121 of this Act shall be granted in accordance with the provisions of
calculating
this section and relevant provisions of Nigeria Tax Administration Act, 2025.
relief to be
allowed for
(2) The foreign tax paid to a treaty partner in accordance with the
double
agreement, and in respect of income or profits chargeable to income tax in
taxation
Nigeria may be allowed as a credit against tax payable under this Act.
(3) The Nigerian tax payable in respect of the income or profit which has
been charged to tax by a treaty partner shall be reduced by the amount of the
credit admissible under the terms of the agreement, provided that credit shall
not be allowed to a person who was not a resident of Nigeria during the rel-
evant year of assessment.
(4) Without prejudice to the provisions of subsection (3), the credit to be
allowed in subsection (2) shall be the lower of the –
(a) Nigerian tax attributable to the foreign income or profits; and
(b) the amount of tax paid to the treaty partner.
(5) The Nigerian tax under subsection (4)(a) attributable to the foreign
income or profits shall be the proportion of the foreign income to total income,
multiplied by the Nigerian tax.
(6) In computing the amount of chargeable income or assessable profits,
the following shall apply –
(a) deduction shall not be allowed in respect of a foreign tax, whether in
respect of the same or any other profits; and
(b) where profits or income chargeable depends on the amount received
in Nigeria, the amount shall be increased by the appropriate amount of the
foreign tax in respect of the profits.
A 466 2025 No. 7 Nigeria Tax Act, 2025
(7) Any claim for credit shall be made not later than two years after the
end of the year of assessment, and in the event of any dispute as to the amount
allowable, the claim shall be subject to objection and appeal in like manner as
an assessment.
(8) Where the amount of any credit given under the agreement is rendered
excessive or insufficient by reason of any adjustment of the amount of any tax
payable in Nigeria or elsewhere, nothing in this Act or Nigeria Tax Administration
Act, 2025 limiting the time for the making of assessments or claims for relief
shall apply to any assessment or claim to which the adjustment gives rise.
(9) Notwithstanding subsection (8), the assessment or claim shall be made
not later than two years from the time when such assessments, adjustments
and other determinations have been made, whether in Nigeria or elsewhere,
as are material in determining whether any of credit is due.
(10) Where, in accordance with any provision of the agreement, income
derived by a resident of Nigeria is exempt from tax under this Act, the exempt
income shall be taken into account in determining the rate of tax applicable on
the remaining income of such resident.

For purpose of Chapter Four of this Act –
Interpreta-
tion
"foreign tax" means any tax paid to a treaty partner and covered by an
agreement with the treaty partner;
"foreign profit" means a profit liable to tax under this Act and to a
treaty partner;
"foreign income" means an income liable to tax under this Act and to a
treaty partner;
"Nigerian tax" means income tax chargeable under this Act;
"total income" means the income or profits of a Nigerian resident includ-
ing the foreign income; and
"treaty partner'' means a country with which Nigeria has an agreement
for the relief of double taxation.
CHAPTER 5
TAXATION OF DUTIABLE INSTRUMENTS
PART I - IMPOSITION OF STAMP DUTIES

There is imposed duties on instruments at the rates specified in the
duties Eighth Schedule to this Act, subject to the exemptions contained in Part III of
Eighth Chapter Nine of this Act, being any instrument which is –
Schedule
(a) first executed in Nigeria; or
(b) executed outside Nigeria, and relates to any property situated or to
any matter or thing done in Nigeria.
Nigeria Tax Act, 2025 2025 No. 7 A 467

(1) Duties payable on any instrument under this Part shall be paid Manner of
and denoted by any of the following means – denoting
duty
(a) tax stamps ;
(b) a die ;
(c) electronic or digital tagging ;
(d) electronic receipt ;
(e) issuance of certificate ; or
(f) any other means as may be determined by the relevant tax authority.
(2) The Joint Revenue Board may, on the advice of the Nigerian Postal
Service and by regulations published in the Official Gazette, determine additional
modes of duty denotation under subsection (1) and specify processes and
requirements for their application as provided under Chapter Five of the Act.

(1) Every instrument executed in Nigeria, chargeable with a duty Obligation
as prescribed under Chapter Five of this Act, shall be stamped not later than to stamp
days after its execution by the person required to pay the appropriate duty.
(2) A person, being the transferee of interest in a real property, other than
in a voluntary disposition during the lifetime of the transferor, or beneficiary of
a service for which consideration was paid, or any other person taking the
security in a transaction for which an instrument is executed, shall be respon-
sible for paying the duty relating to the transaction.

(1) Any unstamped dutiable instrument shall not be admissible in Admissible
evidence in any court, judicial or arbitration proceedings, and in satisfying any evidence
evidentiary requirements unless otherwise stated by this Act.
(2) Notwithstanding the provisions of subsection (1), an unstamped instrument
may be given in evidence in a criminal proceeding.
PART II – CHARGEABLE INSTRUMENTS

For the purposes of Chapter Five of this Act –
Bill of
"bill of exchange" includes draft, order, cheque and letter of credit, and exchange
any document or writing, except a bank note entitling or purporting to entitle
a person, whether named therein or not, to payment by any other person of
or to draw upon any other person for, any sum of money;
"bill of exchange payable on demand" includes an order for the
payment of any sum or money –
(a) by a bill of exchange or a promissory note, or for the delivery of any
bill of exchange or promissory note in satisfaction of any sum of money or
for payment of any sum of money out of any particular fund which may or
A 468 2025 No. 7 Nigeria Tax Act, 2025
may not be available, or on any condition or contingency which may or may
not be performed or happen; and
(b) weekly, monthly or at any other stated periods, an order for the payment
by a person at any time after the date of the payment of any sum of money,
and sent or delivered by the person making the same to the person by whom
the payment is to be made and not to the person to whom the payment is to
be made, or to any person on his behalf.

(1) For the purposes of Chapter Five of this Act, "promissory note"
Note includes any document or writing, except a bank note, containing a promise to
pay any sum of money.
(2) A note promising the payment of any sum of money out of any particular
fund which may or may not be available, or upon any condition or contingency
which may or may not be performed or happen, shall be deemed a promissory
note for that sum of money.

(1) The provisions of Chapter Five of this Act as to contract notes
purchase of shall apply to any contract under which an option is given or taken to purchase
options
or sell any stock or marketable security at a future time at a certain price, as it
applies to the sale or purchase of any stock or marketable security.
(2) Where under the contract in subsection (1), a double option is given
or taken, the contract shall be deemed to be a separate contract in respect of
each option.
Conveyance 131. Every transfer of interest or rights in real property shall be subject
on Sale
to duty under this section as conveyance on sale.
Conveyance 132. Where a property is conveyed to a person in consideration, wholly
in or in part, of a debt due to the person, the debt shall be deemed the considera-
consideration
tion in respect of which the conveyance is chargeable with ad valorem duty.
of a debt
Duty on

(1) The provisions of Chapter Five of this Act as to contract notes
purchase of shall apply to any contract under which an option is given or taken to purchase
options
or sell any stock or marketable security at a future time at a certain price, as it
applies to the sale or purchase of any stock or marketable security.
(2) Where under the contract in subsection (1), a double option is given
or taken, the contract shall be deemed to be a separate contract in respect of
each option.

Every transfer of interest or rights in real property shall be subject
on Sale
to duty under this section as conveyance on sale.

Where a property is conveyed to a person in consideration, wholly
in or in part, of a debt due to the person, the debt shall be deemed the considera-
consideration
tion in respect of which the conveyance is chargeable with ad valorem duty.
of a debt
Duty on

An agreement for the transfer of mineral assets of any kind what-
transfer of
mineral soever or interest therein, shall be charged with duty and payable as specified
assets in the Eighth Schedule to this Act.
Eighth
Schedule

.Where there is an exchange of a real property for another, any
as to
exchange consideration exceeding N 1,000,000 or a sum equal to the annual national
minimum wage, whichever is higher, shall be charged to duty with the same ad
valorem duty as a conveyance on sale.
Leases 135. An agreement for a lease, with respect to the letting of land or
building, shall be subject to duty on grant of a lease or sublease, or the assignment
of a lease, and shall be charged with the same duty as if it were an actual lease
made for the term and consideration mentioned in the agreement, provided
Nigeria Tax Act, 2025 2025 No. 7 A 469
that lease agreements for which the annual value is less than N 10,000,000 or

An agreement for a lease, with respect to the letting of land or
building, shall be subject to duty on grant of a lease or sublease, or the assignment
of a lease, and shall be charged with the same duty as if it were an actual lease
made for the term and consideration mentioned in the agreement, provided
Nigeria Tax Act, 2025 2025 No. 7 A 469
that lease agreements for which the annual value is less than N 10,000,000 or
times the annual minimum wage, whichever is higher, shall not be chargeable
with any duty under Chapter Five of this Act.
Duty on

The share capital of a company shall be charged with an ad valorem
share
duty, as specified in the Ninth Schedule to this Act, of the amount of such capital
capital, or increase of capital, as the case may be. Ninth
Schedule

(1) The loan capital of a company shall be charged with ad valorem Duty on
duty, as specified in the Ninth Schedule to this Act. loan capital
(2) "loan capital" means any debenture stock, other stock or funded Ninth
debt by whatever name known or any debt raised by any corporation, company Schedule
or body of persons formed or established in Nigeria but does not include –
(a) an overdraft;
(b) loan obtained for a period not exceeding twelve months; and
(c) loan obtained for onward disbursement to any other person in an on
lending arrangement:
Provided that for the purpose of paragraph (c) of subsection (2), the Ninth
Schedule
beneficiary of the disbursement shall be responsible to pay the duty as
prescribed in the Ninth Schedule to this Act.

An instrument made for the purpose of issuing marketable securi- Marketable
ties by or on behalf of a company or body of persons, corporate or unincorpo- Security
rated, formed or established in Nigeria shall be subject to duty under Chapter
Five of this Act, whether the securities are issued in Nigeria or not.

(1) Every appraisement or valuation carried out for the purpose of Appraisem-
ents
ascertaining the value of a real property is subject to duty, which shall be
accounted for by the appraiser.
(2) For the purpose of Chapter Five of this Act, "appraiser" means any Duplicates
person who values or appraises any estate or real property, or any interest, and
counterparts
whether in possession or not, in any estate or real property, for a fee.
PART III – MISCELLANEOUS PROVISIONS

The duplicate or counterpart of an instrument chargeable with duty
shall not be deemed duly stamped, unless it is stamped as an original instrument
or certified by the relevant tax authority that the full duty on the original
instrument has been paid.

Where an instrument contains or relates to more than one transaction Duty
relating to
or several distinct matters, each transaction or distinct matter shall be charged
one
to duty separately. instrument
covering
multiple
transactions
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Where multiple instruments chargeable with advalorem duties
relating to
are executed for effecting the same transaction, only one of the instruments,
multiple
instruments as may be determined by the relevant tax authority, shall be charged with the
covering ad valorem duty.
same
transaction
(2) Any other instrument referred to in subsection (1) shall be stamped
Eighth
as counterparts at flat rates prescribed in the Nineth Schedule to this Act.

Where an instrument chargeable with ad valorem duty consists of
on non-
non-monetary consideration, the value shall be deemed as the market value of
monetary
consider- the consideration or part thereof.
ation
CHAPTER 6
VALUE ADDED TAX
PART I – IMPOSITION OF VALUE ADDED TAX

Value Added Tax (VAT) is imposed in accordance with the provisions
of Value
of Chapter Six of this Act.
Added Tax
Charge of

Subject to the exemptions in Part IV of Chapter Eight of this Act,
VAT VAT shall be paid on all taxable supplies in Nigeria.
Taxable

A taxable supply shall be deemed to take place in Nigeria where, in
supplies respect of –
(a) goods –
(i) the goods are physically present, imported into, assembled or installed
in Nigeria at the time of supply, or
(ii) the beneficial owner of the rights in or over the goods is a taxable
person in Nigeria and the goods or right is situated, registered or exercisable
in Nigeria;
(b) a service –
(i) the service is provided to and consumed by a person in Nigeria,
regardless of whether the service is rendered within or outside Nigeria
or whether or not the legal or contractual obligation to render such service
rests on a person within or outside Nigeria, or
(ii) the service is connected with existing immovable property, includ-
ing the services of agents, experts, engineers, architects and valuers,
where the property is located in Nigeria; and
(c) an incorporeal –
(i) the exploitation of the right is made by a person in Nigeria or whose
place of usual residence is Nigeria,
(ii) the right is registered in Nigeria, assigned to or acquired by, a
Nigeria Tax Act, 2025 2025 No. 7 A 471
person in Nigeria, regardless of whether the payment for its exploitation
is made within or outside Nigeria, or
(iii) the incorporeal is connected with a tangible or immovable asset
located in Nigeria.

(1) For the purposes of Chapter Six of this Act, a taxable supply Time of
shall be deemed to take place at the time an invoice or receipt is issued by the Supply
supplier, or where goods are delivered or made available for use, or payment is
due to or received by the supplier in respect of that supply, whichever occurs
first.
(2) A taxable supply shall be deemed to take place where the supplier
and recipient are connected persons and invoices are not issued, in the case of
–
(a) a supply of goods which are to be removed, the time of removal of
the goods;
(b) a supply of goods which is not to be removed at the time when they
are available to the recipient;
(c) furnishing of a service, upon commencement of the furnishing of the
service; or
(d) an incorporeal, when such incorporeal becomes available for the use
of the recipient.
(3) Notwithstanding the provisions of subsections (1) or (2) –
(a) where goods are supplied under any rental agreement or where
services are furnished under any agreement or law which provides for
periodic payments, they shall be deemed to be successively supplied for
successive parts of the periods of the agreement or as determined by such
law, and each of the successive supplies shall be deemed to occur when
payment becomes due or is received, whichever is earlier;
(b) where, and to the extent that, taxable supplies are –
(i) progressively or periodically made under any agreement or law
which provides for the consideration for that supply to be paid in instalments
or periodically and in relation to the progressive or periodic supply, or
(ii) made in relation to any construction, assembly, manufacturing,
alteration, improvement or repair activity under any agreement or law
which provides for the consideration for that supply to become due and
payable in instalments or periodically in relation to the progressive nature
of the work,
the supplies shall be deemed to be successively made, and each succes-
sive supply shall be deemed to take place whenever any payment becomes
due or is received or an invoice relating to only that payment is issued,
whichever occurs first; and
A 472 2025 No. 7 Nigeria Tax Act, 2025
(c) where a taxable supply is made under an instalment credit agreement,
the supply shall be deemed to take place at the time the taxable supply is
delivered or the time any payment of consideration is received by the supplier
in respect of the supply, whichever occurs first.

Subject to the provisions of Part IV of Chapter Eight of this Act,
VAT shall be charged on the value of all taxable supplies at the rate of 7.5%.

(1) For the purposes of Chapter Six of this Act, the value of taxable
taxable supplies shall be determined as follows, where the supply is –
supplies
(a) for a money consideration, its value shall be the amount which with
the addition of the VAT chargeable is equal to the consideration; and
(b) not for a money consideration, the value of the supply shall be its
market value.
(2) Where a taxable supply is not the only transaction to which a
consideration relates, the supply shall be the part of the consideration as is
properly attributable to it.
(3) For the purposes of Chapter Six of this Act, the market value of a
taxable supply, where it is not for money consideration, or for a supply between
connected persons, shall be the money consideration as may be payable by a
person in a transaction at arm's length.

The value of imported taxable supply for the purposes of Chapter
imported Six of this Act shall be the amount which is equal to the price of the taxable
taxable
supply imported plus –
supply
(a) taxes, duties and other charges levied either outside or by reason of
importation into Nigeria, other than VAT imposed under this Act; and
(b) costs by way of commission, parking, transport and insurance up to
the port or point of entry.
Taxable 151. (1) A non-resident person who makes taxable supplies to Nigeria
supply by shall register for tax and include VAT on its invoice for all taxable supplies.
non-
residents
(2) Where a non-resident person is making taxable supplies from outside
Nigeria to persons in Nigeria, the taxable person to whom the supply is made
in Nigeria shall withhold the VAT due on the supply and remit it to the Service.
(3) The Service may, by notice, appoint any person, including a non-
resident supplier of taxable supplies, to collect the VAT and remit it to the
Service.
(4) Where a person appointed under subsection (3) has made a taxable
supply to a taxable person in Nigeria, the taxable person shall not have the
obligation to withhold the VAT, except where the person appointed has failed
to collect the VAT.
Nigeria Tax Act, 2025 2025 No. 7 A 473
(5) Where a person appointed under subsection (3) does not process
payments in respect of the supplies but receives commission relating to the
supplies, the appointed person shall use the mechanism with which it collects
its commission to collect the VAT.
(6) A non-resident person that makes a taxable supply to a person in
Nigeria may appoint a representative for the purpose of compliance with its
VAT obligations.
(7) The Service may issue guidelines for the purpose of giving effect to
the provisions of this section, including the form, time and procedure for filing
returns and payment by non-resident suppliers appointed by the Service under
subsection (3).
(8) Where taxable goods are imported into Nigeria through an online
electronic or digital platform operated by a non-resident supplier and VAT has
been collected by the Service or any person appointed by the Service, the
goods shall not be further subjected to VAT before clearing upon provision of
proof of payment of the VAT.
PART II – REMITTANCES AND RECOVERY OF VAT

(1) A non-resident person who makes taxable supplies to Nigeria
supply by shall register for tax and include VAT on its invoice for all taxable supplies.
non-
residents
(2) Where a non-resident person is making taxable supplies from outside
Nigeria to persons in Nigeria, the taxable person to whom the supply is made
in Nigeria shall withhold the VAT due on the supply and remit it to the Service.
(3) The Service may, by notice, appoint any person, including a non-
resident supplier of taxable supplies, to collect the VAT and remit it to the
Service.
(4) Where a person appointed under subsection (3) has made a taxable
supply to a taxable person in Nigeria, the taxable person shall not have the
obligation to withhold the VAT, except where the person appointed has failed
to collect the VAT.
Nigeria Tax Act, 2025 2025 No. 7 A 473
(5) Where a person appointed under subsection (3) does not process
payments in respect of the supplies but receives commission relating to the
supplies, the appointed person shall use the mechanism with which it collects
its commission to collect the VAT.
(6) A non-resident person that makes a taxable supply to a person in
Nigeria may appoint a representative for the purpose of compliance with its
VAT obligations.
(7) The Service may issue guidelines for the purpose of giving effect to
the provisions of this section, including the form, time and procedure for filing
returns and payment by non-resident suppliers appointed by the Service under
subsection (3).
(8) Where taxable goods are imported into Nigeria through an online
electronic or digital platform operated by a non-resident supplier and VAT has
been collected by the Service or any person appointed by the Service, the
goods shall not be further subjected to VAT before clearing upon provision of
proof of payment of the VAT.
PART II – REMITTANCES AND RECOVERY OF VAT

(1) A taxable person shall pay VAT to a supplier on the taxable Payment of
supply made to the person. VAT by
taxable
(2) The VAT paid by a taxable person under subsection (1) shall be person
known as input VAT.

(1) A taxable person shall, on making taxable supplies under Chapter
VAT by Six of this Act, collect VAT at the rate specified in section 148 of this Act.
taxable
person (2) The VAT collected by a taxable person under subsection (1) shall be
known as output VAT.

(1) Without prejudice to any provision of this Act or any other tax
VAT by law, the following persons shall collect or withhold VAT on taxable supplies
persons
made to them and remit it to the Service within the time prescribed by this Act,
other than
the Nigeria Tax Administration Act, 2025, or any regulation made pursuant
the supplier
thereto –
(a) Federal, State, Local Government and their respective Ministries,
Departments or Agencies; or
(b) any other person appointed by the Service to collect or withhold VAT
for the purposes of this Part.
(2) The Service may direct a taxable person to whom taxable supplies is
made in Nigeria and issued an invoice on which VAT is not included, to self-
account for the VAT payable and remit it to the Service.
(3) The remission of the VAT under subsections (1) and (2) shall be
accompanied with a schedule showing the name, Tax ID and address of the
contractor or supplier, invoice number, gross amount of invoice, amount of the
VAT and the month to which the return relates.
(4) The VAT collected, withheld or self-accounted under this section
shall be remitted to the Service on or before the 14th day of the month imme-
diately following the month of the transaction or as may be prescribed by the
Service.
(5) A person having an obligation to collect VAT under Chapter Six of
this Act shall keep proper records, make appropriate returns and remittances,
and all provisions relating to compliance obligation in chapter six of this Act,
the Nigeria Tax Administration Act, 2025 or related tax laws shall apply to
such person as though it is the taxable person.

(1) Without prejudice to any provision of this Act or any other tax
VAT by law, the following persons shall collect or withhold VAT on taxable supplies
persons
made to them and remit it to the Service within the time prescribed by this Act,
other than
the Nigeria Tax Administration Act, 2025, or any regulation made pursuant
the supplier
thereto –
(a) Federal, State, Local Government and their respective Ministries,
Departments or Agencies; or
(b) any other person appointed by the Service to collect or withhold VAT
for the purposes of this Part.
(2) The Service may direct a taxable person to whom taxable supplies is
made in Nigeria and issued an invoice on which VAT is not included, to self-
account for the VAT payable and remit it to the Service.
(3) The remission of the VAT under subsections (1) and (2) shall be
accompanied with a schedule showing the name, Tax ID and address of the
contractor or supplier, invoice number, gross amount of invoice, amount of the
VAT and the month to which the return relates.
(4) The VAT collected, withheld or self-accounted under this section
shall be remitted to the Service on or before the 14th day of the month imme-
diately following the month of the transaction or as may be prescribed by the
Service.
(5) A person having an obligation to collect VAT under Chapter Six of
this Act shall keep proper records, make appropriate returns and remittances,
and all provisions relating to compliance obligation in chapter six of this Act,
the Nigeria Tax Administration Act, 2025 or related tax laws shall apply to
such person as though it is the taxable person.

(1) A taxable person shall, not later than the due date for rendering
input tax and
the relevant tax return prescribed by the Nigeria Tax Administration Act, 2025,
remission of
where the –
VAT
(a) output VAT exceeds the input VAT, remit the excess to the Service;
or
(b) input VAT exceeds the output VAT, be entitled to utilise the excess
tax as a credit against subsequent months.
Nigeria Tax Act, 2025 2025 No. 7 A 475
(2) A taxable person shall be entitled to a refund of excess VAT not
utilised as a credit, upon request to the Service and provision of such information
or documents as the Service may require.
(3) An importer of taxable goods shall, before clearing those goods, pay
to the Service the VAT on the goods.
(4) A person whose supplies are chargeable to VAT at 0%, shall pay
VAT on taxable supplies consumed in the production of its supplies, and may
thereafter request for a refund of the VAT paid.
(5) Input tax incurred by a registered person on any taxable supply, including
services and fixed assets made to such person, may be deducted from the tax
payable by the person on its taxable supplies at the end of the tax period in
which the supply occurred, but only to the extent that the input tax was incurred
for the purpose of consumption, use or supply in the course of making taxable
supplies.
Provided that –
(a) where any input tax is incurred in making both taxable and non-
taxable supplies, only the proportion relating to making taxable supplies may
be deducted
(b) the input tax shall be allowable for deduction within five years after
the end of the tax period in which the input tax was incurred.
(6) The input tax which may be deducted in line with subsection (5) shall
be limited to taxable supplies made as from the commencement of this Act.

The provisions of section 190 of this Act shall apply in respect of Business
sold out
sale or transfer of trade, business, profession or vocation carried on in Nigeria.

(1) A taxable person making a taxable supply shall implement the Fiscalisation
fiscalisation system deployed by the Service in accordance with Nigeria Tax of supplies
for VAT
Administration Act, 2025.
(2) The fiscalisation system may include fiscal equipment consisting of
electronic devices, software solutions or a communication system involving a
secured network, or any such combination of the components for electronic
invoicing and data transfer as the Service may prescribe or deploy.
CHAPTER 7
SURCHARGE

A surcharge is imposed at 5% on chargeable fossil fuel products Imposition
provided or produced in Nigeria, and shall be collected at the time a chargeable of surcharge
transaction occurs.

(1) For the purpose of imposing surcharge on fossil fuel product, the Chargeable
transaction
chargeable transaction shall be the supply, sale or payment whichever occurs
and base for
first.
surcharge
A 476 2025 No. 7 Nigeria Tax Act, 2025
(2) Surcharge shall be computed based on the retail price of all chargeable
fossil fuel products.

(1) The Minister may by an order issued in the Official Gazette
Administra-
tion of indicate the effective date of commencement of the administration of the
Surcharge surcharge on fossil fuel products under this Chapter.
(2) The Service shall administer and collect the surcharge on a monthly
basis, and may issue regulations for its administration.

(1) The surcharge under this Chapter shall not apply to the following
from fossil fuel products –
Surcharge
(a) clean or renewable energy products;
(b) household kerosene;
(c) cooking gas; and
(d) compressed natural gas (CNG).
(2) For the purpose of this section, "clean or renewable energy" means
energy from solar, wind, hydropower, geothermal or plant and animal waste,
which are naturally replenishing, produce little or no environmental pollution or
greenhouse gas emissions, and do not deplete over time.
CHAPTER 8
TAX INCENTIVES
PART I – INCOME TAX EXEMPTIONS
Income tax 163. (1) There is exempt from tax under chapter two of this Act –
exemption
(a) the profits accruing to, or gains from disposal of assets of any person
being –
(i) a statutory or registered friendly society, where the profits or gains
are not derived from a trade or business carried on by such society,
(ii) a co-operative society registered under any enactment or law
relating to co-operative societies, not being profits or gains from any
trade or business carried on by that society,
(iii) engaged in educational, religious or charitable activities of a public
character where the profits or gains are not derived from a trade or
business carried on by such person,
Cap. T14 (iv) a trade union registered under the Trade Unions Act where the
LFN, 2004 profits or gains are not derived from a trade or business carried on by
such trade union,
(v) a Federal, State or Local Government in Nigeria, their Ministries,
Departments and Agencies and other public institutions, other than profits
Nigeria Tax Act, 2025 2025 No. 7 A 477
or gains derived from trade or business or any instrumentality established
for the purpose of trade or business, and
(vi) a government purchasing authority established by an enactment
and empowered to acquire any commodity for export or redistribution;
(b) dividend distributed by authorised collective investment scheme;
(c) dividend or rental income received by a real estate investment company
on behalf of its shareholders, where not less than 75% of the dividend or
rental income is distributed within 12 months after the end of the financial
year in which the dividend or rental income was earned, provided that nothing
in this subsection shall be construed to exempt a –
(i) shareholder from tax on the dividend or rental income received
from a real estate investment company,
(ii) real estate investment company from tax on management fee,
profits or any other income earned for and on its own account, and
(iii) real estate investment company from tax on dividend or rental
income if it does not meet the conditions stipulated in this paragraph.
(d) compensating payments, which qualify as dividends under section 4
of this Act, received by a lender from its approved agent or a borrower in a
regulated securities lending transaction;
(e) compensating payments, which qualify as dividends or interest under
section 4 of this Act, received by an approved agent from a borrower or
lender on behalf of a lender or borrower in a regulated securities lending
transaction;
(f) consular fees received on behalf of a foreign State, or by a consular
officer on behalf of the State, and the employment income of such officer,
other than income in respect of any trade, business, profession or vocation
carried on by the officer or in respect of any other employment exercised
by him in Nigeria:
Provided that this exemption shall not apply to the income of an employee
engaged in domestic duties, or where the officer or employee ordinarily
resides in Nigeria and is not a national of the foreign State;
(g) an income in respect of which tax is remitted or exempt under the Cap. D9
provisions of the Diplomatic Immunities and Privileges Act or of any LFN, 2004
enactment, order or notice continued in force or effected by that Act;
(h) pension funds and assets created pursuant to the Pension Reform Act No. 4,
Act; 2014
(i) pension, gratuity or any retirement benefits granted in accordance
with the Pension Reform Act;
(j) wound and disability pensions granted to members of the armed forces
or of any recognised national defence organisation, or to a person injured as
a result of enemy action;
A 478 2025 No. 7 Nigeria Tax Act, 2025
(k) a sum received by way of death gratuities or as consolidated
compensation for death or injuries;
(l) subject to the provisions of Part VIII of Chapter Two of this Act,
redundancy lump sum payment and other compensation of capital nature
for loss of employment;
(m) gains accruing from the disposal of assets by an angel investor, venture
capitalist, private equity fund, accelerators or incubators with respect to a
labelled startup provided the assets have been held in Nigeria for a minimum
of 24 months;
(n) income earned from bonds issued by a State or the Federal Government
of Nigeria;
(o) emoluments of any person serving as other rank and other personnel
serving in combat zones, hazardous areas or in designated operations,
provided that where any other income accrues to the person, not being
income by way of personal emoluments, that income shall be liable to tax
under Chapter Two of this Act;
Thirteenth (p) income generated by companies engaged in agricultural businesses
Schedule including crop production, livestock, aquaculture, forestry, dairy and such
other businesses as described in the Thirteenth Schedule to this Act, for the
first five years upon commencement of business;
(q) dividend received from investments in wholly export-oriented
businesses;
(r) profits of a company engaged in sporting activities;
(s) dividend, interest, rent or royalty derived from outside Nigeria and
brought into Nigeria through approved channels;
(t) income of a person from an employment where such person earns
gross income of national minimum wage or less from such employment;
(u) wages and salaries of military officers; and
(v) the profits of any Nigerian company (other than companies engaged
in the upstream, midstream or downstream petroleum operations) in respect
of goods or services exported from Nigeria if the proceeds of such exports
are repatriated through official channels.
(2) The following shall not constitute chargeable gains under Part VIII of
Chapter Two of this Act –
(a) gains accruing to –
(i) pension funds and assets approved under the Pension Reform Act,
and
(ii) an individual from disposal of investment held as part of any national
provident fund or other retirement benefits schemes established under
the provisions of any Act or enactment for employees throughout Nigeria;
(b) gains on the disposal of a decoration, awarded for valour or gallant
Nigeria Tax Act, 2025 2025 No. 7 A 479
conduct which a person acquires otherwise than for consideration in money
or money's worth.
(3) A company shall be entitled to an additional deduction of 50% in the
relevant years of assessment in respect of costs incurred in any two calendar
years from 2023 to 2025 on the following –
(a) wage awards, salary increases, transportation allowance or transport
subsidy granted to a low-income worker, which bring the gross monthly
remuneration of the worker up to an amount not exceeding N100,000
Provided that any additional award or salary increase to an employee earning
above N100,000 as monthly salary shall not qualify for the additional
deduction under this subsection; and
(b) salaries of any new employee constituting a net increase in the average
number of new employees hired in 2023 and 2024 calendar years over and
above the average net employment in the three preceding years, provided
that such new employees are not involuntarily disengaged within a period of
three years post-employment.
(4) In this section –
"net employment" means the total number of persons employed less the
total number of persons disengaged during the calendar year, whether such
disengagement is voluntary or not.
"other rank" has the meaning assigned to it by the Armed Forces Pen- Cap. A23,
sions Act. LFN 2004
"personal emoluments" means wages or salaries and includes allowances,
benefits in kind, gratuities, superannuation or pension schemes and any other
income derived solely by reason of employment as other rank.

(1) The surcharge under this Chapter shall not apply to the following
from fossil fuel products –
Surcharge
(a) clean or renewable energy products;
(b) household kerosene;
(c) cooking gas; and
(d) compressed natural gas (CNG).
(2) For the purpose of this section, "clean or renewable energy" means
energy from solar, wind, hydropower, geothermal or plant and animal waste,
which are naturally replenishing, produce little or no environmental pollution or
greenhouse gas emissions, and do not deplete over time.
CHAPTER 8
TAX INCENTIVES
PART I – INCOME TAX EXEMPTIONS

(1) The Minister may by an order issued in the Official Gazette
Administra-
tion of indicate the effective date of commencement of the administration of the
Surcharge surcharge on fossil fuel products under this Chapter.
(2) The Service shall administer and collect the surcharge on a monthly
basis, and may issue regulations for its administration.
Exemption 162. (1) The surcharge under this Chapter shall not apply to the following
from fossil fuel products –
Surcharge
(a) clean or renewable energy products;
(b) household kerosene;
(c) cooking gas; and
(d) compressed natural gas (CNG).
(2) For the purpose of this section, "clean or renewable energy" means
energy from solar, wind, hydropower, geothermal or plant and animal waste,
which are naturally replenishing, produce little or no environmental pollution or
greenhouse gas emissions, and do not deplete over time.
CHAPTER 8
TAX INCENTIVES
PART I – INCOME TAX EXEMPTIONS

(1) There is exempt from tax under chapter two of this Act –
exemption
(a) the profits accruing to, or gains from disposal of assets of any person
being –
(i) a statutory or registered friendly society, where the profits or gains
are not derived from a trade or business carried on by such society,
(ii) a co-operative society registered under any enactment or law
relating to co-operative societies, not being profits or gains from any
trade or business carried on by that society,
(iii) engaged in educational, religious or charitable activities of a public
character where the profits or gains are not derived from a trade or
business carried on by such person,
Cap. T14 (iv) a trade union registered under the Trade Unions Act where the
LFN, 2004 profits or gains are not derived from a trade or business carried on by
such trade union,
(v) a Federal, State or Local Government in Nigeria, their Ministries,
Departments and Agencies and other public institutions, other than profits
Nigeria Tax Act, 2025 2025 No. 7 A 477
or gains derived from trade or business or any instrumentality established
for the purpose of trade or business, and
(vi) a government purchasing authority established by an enactment
and empowered to acquire any commodity for export or redistribution;
(b) dividend distributed by authorised collective investment scheme;
(c) dividend or rental income received by a real estate investment company
on behalf of its shareholders, where not less than 75% of the dividend or
rental income is distributed within 12 months after the end of the financial
year in which the dividend or rental income was earned, provided that nothing
in this subsection shall be construed to exempt a –
(i) shareholder from tax on the dividend or rental income received
from a real estate investment company,
(ii) real estate investment company from tax on management fee,
profits or any other income earned for and on its own account, and
(iii) real estate investment company from tax on dividend or rental
income if it does not meet the conditions stipulated in this paragraph.
(d) compensating payments, which qualify as dividends under section 4
of this Act, received by a lender from its approved agent or a borrower in a
regulated securities lending transaction;
(e) compensating payments, which qualify as dividends or interest under
section 4 of this Act, received by an approved agent from a borrower or
lender on behalf of a lender or borrower in a regulated securities lending
transaction;
(f) consular fees received on behalf of a foreign State, or by a consular
officer on behalf of the State, and the employment income of such officer,
other than income in respect of any trade, business, profession or vocation
carried on by the officer or in respect of any other employment exercised
by him in Nigeria:
Provided that this exemption shall not apply to the income of an employee
engaged in domestic duties, or where the officer or employee ordinarily
resides in Nigeria and is not a national of the foreign State;
(g) an income in respect of which tax is remitted or exempt under the Cap. D9
provisions of the Diplomatic Immunities and Privileges Act or of any LFN, 2004
enactment, order or notice continued in force or effected by that Act;
(h) pension funds and assets created pursuant to the Pension Reform Act No. 4,
Act; 2014
(i) pension, gratuity or any retirement benefits granted in accordance
with the Pension Reform Act;
(j) wound and disability pensions granted to members of the armed forces
or of any recognised national defence organisation, or to a person injured as
a result of enemy action;
A 478 2025 No. 7 Nigeria Tax Act, 2025
(k) a sum received by way of death gratuities or as consolidated
compensation for death or injuries;
(l) subject to the provisions of Part VIII of Chapter Two of this Act,
redundancy lump sum payment and other compensation of capital nature
for loss of employment;
(m) gains accruing from the disposal of assets by an angel investor, venture
capitalist, private equity fund, accelerators or incubators with respect to a
labelled startup provided the assets have been held in Nigeria for a minimum
of 24 months;
(n) income earned from bonds issued by a State or the Federal Government
of Nigeria;
(o) emoluments of any person serving as other rank and other personnel
serving in combat zones, hazardous areas or in designated operations,
provided that where any other income accrues to the person, not being
income by way of personal emoluments, that income shall be liable to tax
under Chapter Two of this Act;
Thirteenth (p) income generated by companies engaged in agricultural businesses
Schedule including crop production, livestock, aquaculture, forestry, dairy and such
other businesses as described in the Thirteenth Schedule to this Act, for the
first five years upon commencement of business;
(q) dividend received from investments in wholly export-oriented
businesses;
(r) profits of a company engaged in sporting activities;
(s) dividend, interest, rent or royalty derived from outside Nigeria and
brought into Nigeria through approved channels;
(t) income of a person from an employment where such person earns
gross income of national minimum wage or less from such employment;
(u) wages and salaries of military officers; and
(v) the profits of any Nigerian company (other than companies engaged
in the upstream, midstream or downstream petroleum operations) in respect
of goods or services exported from Nigeria if the proceeds of such exports
are repatriated through official channels.
(2) The following shall not constitute chargeable gains under Part VIII of
Chapter Two of this Act –
(a) gains accruing to –
(i) pension funds and assets approved under the Pension Reform Act,
and
(ii) an individual from disposal of investment held as part of any national
provident fund or other retirement benefits schemes established under
the provisions of any Act or enactment for employees throughout Nigeria;
(b) gains on the disposal of a decoration, awarded for valour or gallant
Nigeria Tax Act, 2025 2025 No. 7 A 479
conduct which a person acquires otherwise than for consideration in money
or money's worth.
(3) A company shall be entitled to an additional deduction of 50% in the
relevant years of assessment in respect of costs incurred in any two calendar
years from 2023 to 2025 on the following –
(a) wage awards, salary increases, transportation allowance or transport
subsidy granted to a low-income worker, which bring the gross monthly
remuneration of the worker up to an amount not exceeding N100,000
Provided that any additional award or salary increase to an employee earning
above N100,000 as monthly salary shall not qualify for the additional
deduction under this subsection; and
(b) salaries of any new employee constituting a net increase in the average
number of new employees hired in 2023 and 2024 calendar years over and
above the average net employment in the three preceding years, provided
that such new employees are not involuntarily disengaged within a period of
three years post-employment.
(4) In this section –
"net employment" means the total number of persons employed less the
total number of persons disengaged during the calendar year, whether such
disengagement is voluntary or not.
"other rank" has the meaning assigned to it by the Armed Forces Pen- Cap. A23,
sions Act. LFN 2004
"personal emoluments" means wages or salaries and includes allowances,
benefits in kind, gratuities, superannuation or pension schemes and any other
income derived solely by reason of employment as other rank.

(1) Subject to the provisions of this section and notwithstanding Deductible
anything contained in section 20 of this Act, for the purposes of ascertaining donations
the profits or loss of any company for any period from any source chargeable
with tax under Chapter Two of this Act, there shall be deducted the amount of
any donation made for that period by that company to any fund, body or
institution in Nigeria to which this section applies.
(2) Without prejudice to section 21 of this Act, any donation made by a
company pursuant to subsection (1) may be deducted from the profits of that
period notwithstanding that the donation is of a revenue or capital nature.
(3) This section shall apply to donations made to –
(a) public funds;
(b) statutory bodies or institutions;
(c) religious, charitable, educational and scientific institutions, established
in Nigeria;
A 480 2025 No. 7 Nigeria Tax Act, 2025
Cap. D9, (d) bodies recognised under the Diplomatic Immunities and Privileges
LFN, 2004 Act; or
(e) any pandemic, natural disaster or other public emergency interven-
tions.
(4) A company making a deduction for a donation shall provide requisite
document evidencing the donation to the relevant tax authority.
(5) The total deduction to be allowed to a company, under this section,
for any year of assessment, shall not exceed an amount equal to 10% of the
profit before tax of that company for that year.
(6) In the case of a donation other than in cash, the value for the purpose
of this section shall be the lower of the market value at the time of the donation
or the consideration paid for the item when it was acquired.

(1) Notwithstanding anything contained in section 20 of this Act, for
for research
the purpose of ascertaining the profit or loss of any company for any period
and
from any source chargeable with tax under Chapter Two of this Act, there
development
shall be deducted the amount incurred in that period by that company for
research and development.
(2) The deduction to be allowed to a company under subsection (1) for
any year of assessment shall not exceed an amount which is equal to 5% of
the turnover for that year.
(3) Where a company to which this section applies subsequently sells or
transfers the outcome of the research and development to another person for
exploitation or commercialisation, the proceeds of such sale or transfer shall
be taxed under Chapter Two of this Act.
PART II – ECONOMIC DEVELOPMENT TAX INCENTIVES

(1) The sectors listed in the Tenth Schedule to this Act are classified
Sectors as priority sectors for the purposes of economic development tax incentives.
Tenth
Schedule
Tenth (2) The period of incentives for any priority sector shall be as provided in
Schedule
the Tenth Schedule to this Act.
Tenth (3) The President may direct an amendment to the list contained in the
Schedule
Tenth Schedule to this Act, where, in his opinion –
(a) any sector is not operating on a scale suitable to the economic
requirements of Nigeria, or there are favourable prospects of further
development;
(b) it is expedient in the public interest to encourage the development or
establishment of a sector in Nigeria for the purpose of –
Nigeria Tax Act, 2025 2025 No. 7 A 481
(i) generating employment,
(ii) attracting foreign direct investment inflow, or
(iii) economic diversification;
(c) any sector, product or service within a sector, is considered to have
Tenth
been sufficiently developed to necessitate its removal from the list contained Schedule
in Tenth Schedule to this Act.

(1) An application for economic development incentive certificate Eligibility
for economic
may be made by a company incorporated in Nigeria, companies granted
development
exemption from incorporation or by promoters of a company which is yet to be
incentive
incorporated. certificate
(2) An application for the issuance of an economic development incen- Tenth
tive certificate by a company shall be considered under this section where the Schedule
qualifying capital expenditure to be incurred by the company on or before
production day, if the application is approved, is not below the amount specified
in the Tenth Schedule to this Act.

(1) Subject to the provisions of this Part, every application for eco- Application
for economic
nomic development incentive certificate shall be addressed to the Executive
development
Secretary of the Nigerian Investment Promotion Commission (NIPC), and
incentive
shall be in such form as may be specified. certificate
(2) The application shall –
(a) show a commitment of, or the ability to commit, the minimum capital Tenth
Schedule
required to invest in the specified priority sector listed in the Tenth Schedule
to this Act ;
(b) state whether the company is, or the proposed company when
incorporated shall be, a company that the ultimate parent entity is a resident
company or non-resident company ;
(c) give particulars of the assets on which qualifying capital expenditure
is incurred or to be incurred by the company, including the source and cost
or estimated cost –
(i) on or before production day, and
(ii) during a period of three years following the production day;
(d) specify the place in which the assets, in respect of which qualifying
expenditure was incurred or to be incurred by the company or proposed
company, is situated or to be situated;
(e) state the date or probable date of production day of the company or
proposed company;
(f) specify any product, service, and by-product, not being a priority
product, being produced or proposed to be produced by the company or
A 482 2025 No. 7 Nigeria Tax Act, 2025
proposed company, and give a reasonable estimate of the quantities and
value of such product and by-product during a period of one year from
production day;
(g) give particulars of the loan and share capital, or the proposed loan
and share capital of the company, or proposed company, including the amount
and date of each issued shares or proposed issue, and the source from
which the capital is to be or has been raised;
(h) in the case of a company already incorporated, provide the details of
the ownership structure of the company and the nationality of each director
of the company; and
(i) in the case of a proposed company, provide the name, Tax ID, ad-
dress, and nationality of each promoter of the company and the proposed
ownership structure.
(3) An application shall contain a declaration signed by the applicant that
all the information contained in the application is true, and an undertaking to
produce proof, if required.
(4) The application shall be accompanied by a non-refundable fee of
1% of the qualifying capital expenditure incurred or to be incurred, subject to
a maximum of N 5,000,000 and no further fee shall be payable to the NIPC in
respect of the application.
(5) The NIPC shall recommend the application to the Minister, for ap-
proval or otherwise, including the projected tax expenditure impact report in its
recommendation.
(6) The Minister, acting on the recommendation of the NIPC, may
recommend the application to the President for approval.
(7) An economic development incentive certificate shall not be issued to
a company without the approval of the President.
(8) The NIPC shall submit an annual report of the list of sectors and
companies that have benefited under this Part to the Minister who shall, not
later than 30 days, present a copy of the report to the President and the National
Economic Council.

(1) A company whose application has been approved in line with
application
section 168 of this Act, shall be issued an economic development incentive
certificate.
Tenth (2) Where a sector is removed from the Tenth Schedule to this Act –
Schedule
(a) economic development incentive certificate shall not be issued to a
company in relation to that sector with respect to any pending application
made under section 168 of this Act; and
Nigeria Tax Act, 2025 2025 No. 7 A 483
(b) a company issued an economic development incentive certificate
before the removal shall exhaust its unexpired incentive period only.

(1) Every economic development incentive certificate shall be in Terms of
accordance with the terms and conditions stipulated in this Part. economic
development
(2) An economic development incentive certificate shall specify – incentive
certificate
(a) conditions of the certificate; and
(b) any permissible by-product that may be produced by the company in
addition to the priority product and the proportion of the permissible by-
product in relation to the priority product, either in quantity or in value or
both.
(3) Where an application for economic development incentive certificate
for a proposed company has been approved, its promoters shall incorporate
the company, not later than three months after the date of notification of the
approval.
(4) An economic development incentive certificate to be issued to a
company to which subsection (3) relates shall be issued only after the company
has been incorporated and the certificate shall be effective from the company's
production day.
(5) In the case of an existing company, the NIPC shall, not later than 30
days after the approval of the President, issue the certificate and communicate
it to the applicant.
(6) Notwithstanding anything contained in section 178 of this Act, where
a company to which economic development incentive status has been issued –
(a) acquires another company to which an economic development Cap. I7
incentive certificate has been issued under this Part or its equivalent under LFN, 2004
the Industrial Development (Income Tax Relief) Act, the incentive status of
both companies shall cease on the expiry date indicated on the economic
development incentive certificate of the subsisting company;
(b) takes over the assets and business of any company which is not a
company with an economic development incentive status, such acquisition
of asset and business of that company shall be subject to sections 168 and
of this Act;
(c) is acquired by a company with no economic development incentive
status, the economic development incentive status of the acquired company
shall not be transferred to the acquiring company except as may be approved
in accordance with sections 168 and 171 of this Act;
(d) merges with one or more companies that have been issued economic
development incentive certificate or its equivalent –
(i) the incentive status of the merging companies shall cease on the
date of the merger,
A 484 2025 No. 7 Nigeria Tax Act, 2025
(ii) the emerging company from the merger may apply for economic
development incentive status, and
(iii) the expiration date of the economic development incentive
certificate to be granted under subsection (6)(d)(ii) to the emerging
company, shall not be longer than the later date on the economic
development incentive certificate of the merging companies.

(1) A priority company may, at any time during its incentive period,
product to make an application in writing to the Executive Secretary of the NIPC for its
the economic
economic development incentive certificate to be amended to add another
development
product to the priority product or products specified in the certificate.
incentive
certificate
(2) An application under this section shall specify the additional priority
product and the reasons for the application and the provisions of sections 168
and 171 of this Act shall apply.
(3) An economic development incentive certificate may be extended for
an additional period of five years and no more, on the condition that the priority
company invests 100% of its profits during the incentive period for expansion
of the same product or products.
Application 172. (1) Subject to the provision of section 173 of this Act, where an
of economic economic development incentive certificate is issued to a company and the
development provisions of Chapter Two of this Act has been applied on the company after
incentive
the effective date of the certificate, appropriate adjustments shall be made to
certificate
give effect to the provisions of this Part.
(2) No economic development incentive certificate under this Act shall
be issued with a retroactive date.

(1) Subject to the provision of section 173 of this Act, where an
of economic economic development incentive certificate is issued to a company and the
development provisions of Chapter Two of this Act has been applied on the company after
incentive
the effective date of the certificate, appropriate adjustments shall be made to
certificate
give effect to the provisions of this Part.
(2) No economic development incentive certificate under this Act shall
be issued with a retroactive date.

(1) A company issued an economic development incentive certificate
day and shall, not later than one month after its production day, apply to the relevant
qualifying authority to certify its production day.
capital
expenditure (2) The relevant authority shall within one month of certifying the
production day, notify the NIPC and the Service of the production day of the
company.
(3) Not later than one month after the production day of the company
has been determined and certified under this section, or within such extended
time as the Service may allow, the company shall make an application in writing
to the Service to certify the amount of the qualifying capital expenditure incurred
by the company prior to production day and the company shall supply full
particulars of the capital expenditure so incurred.
(4) In determining the amount of qualifying capital expenditure incurred
by the company prior to its production day, any sum derived directly or indirectly
by that company from disposal, made before the production day, of any asset
on which qualifying capital expenditure has been incurred, shall be deducted
Nigeria Tax Act, 2025 2025 No. 7 A 485
from the amount of the qualifying capital expenditure.
(5) Where the disposal of asset referred to in subsection (4) is by way of
a bargain not made at arm's length or to a connected person, the Service shall
consider the asset disposed of at its market value in a comparable transaction
conducted at arm's length.
(6) The Service shall issue a certificate to the company certifying the
amount of qualifying capital expenditure incurred by the company prior to
production day.
(7) The provisions of Chapter Two of Nigeria Tax Administration Act,
which relate to objections and appeals shall apply to any certificate issued
by the Service under this section, as if such certificate were a notice of
assessment given under the provisions of the Nigeria Tax Administration Act,
2025.
(8) Where the amount of the qualifying capital expenditure incurred by
the company prior to production day has been determined and certified by the
Service, the Service shall notify the NIPC of the amount.
(9) Where a certificate issued by the Service under subsection (6) certi- Tenth
fies that the company has on or before production day incurred qualifying Schedule
capital expenditure lower than the amount specified in the Tenth Schedule to
this Act, the Service shall discountenance such economic development incen-
tive certificate and notify the NIPC accordingly.
(10) For the purposes of this section, "production day" means in relation
to a company –
(a) providing services, the date in which the company is ready to provide
such priority service on a commercial scale; and
(b) engaged in manufacturing, processing, mining, agricultural or any
other priority industry, the date in which the company begins to produce the
priority product in commercial quantities.

(1) The NIPC shall cancel an economic development incentive Cancellation
certificate – of economic
development
(a) on the application of the priority company concerned; incentive
certificate
(b) on the cessation of the priority business or the company being liquidated
or wound up; or
(c) where the priority company fails to commence production 12 months
after the proposed production day.
(2) The Minister may, on the recommendation of the NIPC, suspend the
economic development incentive certificate and require the priority company
to, not later than three months, remedy a non-compliance and furnish the details
of compliance where –
A 486 2025 No. 7 Nigeria Tax Act, 2025
(a) any of the conditions for the grant of economic development incentive
certificate was not met; or
(b) the Minister is of the opinion that a priority company has contravened
any provision of this Part or has failed to fulfil any estimate or proposal
made in its application for an economic development incentive certificate or
any conditions contained in its certificate.
(3) Where a priority company fails to remedy the non-compliance or
furnish the details of the compliance within the time specified in subsection (2),
the Minister shall, on the recommendation of the NIPC, recommend to the
President, the cancellation of the economic development incentive certificate.
(4) The President may, on the recommendation of the Minister, approve
the cancellation of the economic development incentive certificate of the
company, and any benefit that has accrued to the priority company from the
economic development incentive status may be withdrawn.
(5) The effective date of cancellation of an economic development
incentive certificate of a priority company shall be where the –
(a) company has operated for a period less than one year after the
production day ;
(b) company has operated for a period more than one year after the
production day, the date of the last anniversary of the production day; or
(c) cancellation is as a result of failure to meet any of the conditions for
the grant of economic development incentive certificate on the production
day.
(6) Where the economic development incentive certificate of a company
is suspended or cancelled, or where benefits that accrued to the company is
withdrawn, the NIPC shall give notice of the cancellation or withdrawal to the
Service and the company concerned, specifying the effective date thereof.

The NIPC, Federal Ministry of Industry Trade and Investment or
the Service may require a priority company to provide information on –
(a) the local production costs and factory prices of the products of the
company;
(b) the relative cost, including freight and insurance, of imported products
equivalent or similar to the priority products produced by the company; or
(c) any other matter as may be required for the purposes of this Part or
any provision of this Act.

The NIPC shall cause to be published in the Official Gazette –
of economic
development (a) the name of any company to which an economic development incentive
incentive certificate has been issued and the priority sector or product to which the
certificate certificate relates;
Nigeria Tax Act, 2025 2025 No. 7 A 487
(b) the name of any company whose economic development incentive
certificate has been cancelled and the effective date of the cancellation;
and
(c) any restriction of the incentive period of a company granted an economic
development incentive status.

(1) The tax payable on the profits of a priority product or service in Economic
any year of assessment during the priority period of a company, computed in development
tax credit
accordance with the provisions of chapter two of this Act, shall constitute
economic development tax credit for the company.
(2) Subject to section 57 of this Act, the economic development tax credit
may be utilised to offset the tax payable of any year of assessment during the
priority period, except the additional tax payable under that section
(3) A company having unutilised tax credit may utilise it within five as-
sessment years after the end of the priority period, after which any unutilised
tax credit shall lapse.

The incentive period of a priority company shall commence on the Economic
development
production day of the company, and subject to sections 170, 171 and 174 of this
incentive
Act, shall be for a period of five years.
period

(1) Where a priority company carries on a non-priority business, the Books and
company shall maintain separate records of income and books of account for records for
priority
each business.
products
(2) The records of each business certified by an auditor, shall be sufficient
to enable the determination of the turnover, income or profits of each class of
business.
(3) Where, in the opinion of the Service, the company has not complied
with the provision of this section, all the income of the company shall be deemed
non-priority and economic development tax credit shall not be granted.

(1) All the relevant provisions of Chapter Two of this Act and the Returns of
Nigeria Tax Administration Act, 2025, including the filing of returns, shall apply profits
to a company granted economic development incentive status during the priority
period.
(2) The company shall provide evidence of compliance with the minimum Tenth
qualifying criteria specified in sections 167 and 168, and the Tenth Schedule to Schedule
this Act, accompanied with the annual income tax returns.

(1) The Service may, not later than six years after the cancellation Cancellation
of an economic development incentive certificate, withdraw or discountenance or discounte-
nance of
an economic development tax credit granted under this Part, except in the
economic
case of fraud where there is no limit to the time for the withdrawal of the
development
economic development tax credit. tax credit
A 488 2025 No. 7 Nigeria Tax Act, 2025
(2) Where an economic development tax credit is withdrawn or
discountenanced under subsection (1), the Service shall, within the time pre-
scribed under the Nigeria Tax Administration Act, 2025, issue notice of addi-
tional assessment to the company.

(1) For the purposes of Chapter Two of this Act, the trade of a
for planta-
company which operates a plantation to which an economic development
tion industry
incentive certificate has been issued shall be deemed to have commenced on
the date when the planting first reaches commercial production.
First (2) Expenditure incurred on the maintenance of a planted area up to the
Schedule
date specified in subsection (1) is deemed to have brought an asset into
existence, and the expenditure shall be qualifying plantation expenditure on the
date the business commenced, for the purposes of Part I of the First Schedule
to this Act.
Exclusion

(1) Any company granted economic development tax credit, shall
from other
reliefs and not benefit from a similar tax incentive under this Act or any other law.
transition
arrangements
Cap. I7
LFN, 2004
(2) Any company granted an incentive under the Industrial Development
(Income Tax Relief) Act shall continue to enjoy the reliefs applicable under the
Act for the unexpired period as at the commencement of this Act.
(3) Where a company has been granted an economic development
incentive under this Act prior to the applicable sunset for the sector or activity,
the company shall continue to enjoy the reliefs applicable under this Chapter
for the unexpired period as specified under sections 177 and 178 of this Act.

In this Part –
Interpreta-
tion
"Minister" means the Minister responsible for industry, trade and
investment;
"relevant authority" means the Industrial Inspectorate Department of
the Federal Ministry of Industry, Trade and Investment; and
Tenth "sunset" in the context of the Tenth Schedule means the period counting
Schedule
from the date of commencement of this Act after which a sector, industry
or activity shall cease to be eligible for the economic development incentive
subject to section 183 (3) of this Act.
PART III – EXEMPTION FROM STAMP DUTIES

The following instruments shall be exempted from stamp duties under
from stamp
Chapter Eight of this Act –
duties
(a) transfer of shares in Government or legislative stocks or funds of
Nigeria;
Nigeria Tax Act, 2025 2025 No. 7 A 489
(b) any instrument for sale, transfer or other disposition, either
absolutely or by way of mortgage, or otherwise, of any ship or vessel
or any part, interest, share or property of or in any ship or vessel;
(c) any instrument on which the duty would be payable by a Nige-
rian Government or any of its ministries, departments or agencies;
(d) any instrument in which the duty would be payable by any
consular officer arising out of his official functions provided the for-
eign government he represents grants similar exemption to Nigerian
consular officers;
(e) any instrument executed by or on behalf of a co-operative
society registered under any Act or law;
(f) shares, stocks or securities transferred by a lender to its ap-
proved agent or a borrower in furtherance of a regulated securities
lending transaction;
(g) shares, stocks or securities returned to a lender or its approved
agent by a borrower in pursuant of a regulated securities lending
transaction; or
(h) all documents relating to the transfer of stocks and shares.
(i) electronic transfer or electronic receipts of money of a sum
below N 10,000 or its equivalent in other currencies, transfers for
salary payment and intra-bank self- transfers.
PART IV - EXEMPTION FROM VALUE ADDED TAX

(1) The following supplies are exempt from the VAT imposed Exempt
under Chapter Six of this Act – Supplies
(a) oil and gas exports;
(b) crude petroleum oil and feed gas for all processed gas;
(c) goods purchased for use in humanitarian donor funded projects;
(d) baby products;
(e) locally manufactured sanitary towels, pads or tampons;
(f) military hardware, arms, ammunitions and locally manufactured
uniforms supplied to armed forces, para-military and other security
agencies of a Nigerian government;
(g) shared passenger road-transport service;
(h) purchase, hire, rental or lease of tractors, ploughs and other
equipment used for agricultural purposes.
(i) supplies consumed by an approved entity in the export process-
ing or free trade zones, provided that the supplies are consumed on its
approved activity;
A 490 2025 No. 7 Nigeria Tax Act, 2025
Cap. D9, (j) goods or services supplied to a diplomatic mission, diplomat or person
LFN, 2004
recognised under the Diplomatic Immunities and Privileges Act whose
activity is in public interest, and not for profit;
(k) plays and performances conducted by educational institutions as part
of learning;
(l) land or building including interest in land or building;
(m) money or securities including interest in money or securities;
(n) Government licences; and
(o) Assistive devices and disability-related products including hearing
aids, wheelchairs, and braille materials.
Eleventh (2) Notwithstanding the provisions of Chapter Six of this Act, VAT shall
Schedule not be collected on the items specified in paragraph 1 of the Eleventh Schedule
to this Act except where the Minister by an order, published in the Official
Gazette, specifies the date of collection of VAT on the items listed in the order.

Subject to paragraph 2 of the Thirtenth Schedule to this Act, the
Taxable
supplies following taxable supplies are charged to VAT at the rate of 0% –
chargeable at
0%
Thirteenth (a) basic food items;
Schedule
(b) all medical and pharmaceutical products including medicinal herbal
products;
(c) educational books and materials;
(d) fertilisers;
(e) locally produced agricultural chemicals;
(f) locally produced veterinary medicine;
(g) locally produced animal feeds;
(h) live cattle, goats, sheep and poultry;
(i) agricultural seeds and seedlings;
(j) electricity generated by generation companies (GENCOs) and supplied
to National Grid or Nigeria Bulk Electricity Trading Company (NBET);
(k) electricity transmitted by Transmission Company of Nigeria (TCN)
to Electricity Distribution Companies (DISCOs);
(l) medical services,
(m) tuition relating to nursery, primary, secondary or tertiary education
(n) exported goods excluding oil and gas;
(o) exported services;
(p) exported incorporeal property;
(q) medical equipment;
Nigeria Tax Act, 2025 2025 No. 7 A 491
(r) electric vehicles; and
(s) parts, semi-knock-down units for the assembly of Electric Vehicles.

Where, a government or an agency of a government in Nigeria has Exemption
entered into an agreement with the government of another country or a donor by Order of
the President
agency for the provision of developmental financing for any project in Nigeria,
and such agreement provides for the exemption of supplies made under the
project from VAT, the President may, by an order published in the Official
Gazette, give effect to the exemption.

For the purposes of this Part and Chapter Six of this Act – Interpreta-
tion
"agricultural seeds and seedlings" refer to seeds and seedlings for
the cultivation of agricultural plants and crops;
"baby products" means products made for the use of babies from birth
to three years of age and described below –
(a) baby activity and entertainment products for example, baby safety
car and home accessories, high chairs, cots, bassinets, baskets or cribs
along with parts and accessories;
(b) baby bathtub, sponges, towels, for example, baby grooming kit, baby
creams, powders or lotions;
(c) baby carriage and parts for example, carriers, slings, bouncers, swing
or rockers, along with parts and accessories;
(d) baby garments and clothing of any material;
(e) feeding products, for example, feeding bottle, feeding bottle warmers
and related accessories;
(f) plates, spoons, cups, sippy cups, breast pumps and accessories, nursing
and feeding pillows;
(g) sanitary wares, for example, diapers, wipes and related products,
diaper bags, potty and toilet training devices, baby mattress waterproof cover,
baby toiletries, changing table and mat; and
(h) others, for example, baby monitors along with parts and accessories;
"basic food items" means an agriculture-based or aquatic-based staple
food including –
(a) locally produced table honey;
(b) white bread and brown bread;
(c) cereals including maize, rice, wheat, millet, barley, sorghum, oats,
fonio and finer millet, in the form of grain, flour, crop, whether raw or semi-
processed, whether in bulk or retail;
(d) cooking oils including, vegetable oil, soya oil, palm oil, groundnut oil,
shea butter, beniseed oil, olive oil, coconut oil, provided that they are of a
type and grade suitable for culinary purposes, and do not contain any
A 492 2025 No. 7 Nigeria Tax Act, 2025
substance such as, fragrance, which will make them unsuitable for culinary
use;
(e) culinary herbs including, curry, thyme, onions, ginger, mint, whether
raw or processed;
(f) fish of all kinds other than ornamental, whether live, fresh, frozen,
smoked or dried;
(g) flour and starch including, corn flour, plantain flour, cassava flour,
beans flour, wheat flour, rice flour, yam flour, cassava flakes (garri), whether
bleached or unbleached, refined or unrefined, provided that it is suitable for
culinary purposes;
(h) fruits including, pineapples, oranges, mangoes, guavas, grape fruit,
banana and pawpaw, whether fresh or dried;
(i) live or raw meat from cow, goat, lamb, pig, poultry, whether butchered
or in parts, fresh or frozen, and including poultry eggs;
(j) milk, whether fresh or processed into liquid or powdered form;
(k) nuts for human consumption such as, groundnut, walnut, cashew nut,
hazelnut, kolanut, tigernuts and coconut, whether raw, roasted, dried, fried,
boiled or seasoned, cracked or in the shells;
(l) pulses for human consumption including, beans, lentils, peas, chickpeas
and tamarind, whether raw, roasted, fried, boiled, salted or in their shells;
(m) tubers (roots) of yam, cocoyam, potatoes, water-yam, cassava,
whether in raw form, flakes or flour for human consumption;
(n) salt for only culinary use, means fine salt and salt in retail packs, and
excludes industrial salt;
(o) vegetables including pepper, melon, lettuce, okra, cabbage, carrot,
whether fresh, dried or ground;
(p) water means natural water and table water, including spring water,
rain water, pipe borne water or well water excluding –
(i) sparkling or flavoured water,
(ii) water sold in restaurants, hotels, eateries, lounges, cafes, canteens
and other similar settings, and
(iii) water sold by contractors, caterers or similar persons;
"educational books" means physical or electronic books used to
implement instruction and facilitate learning in educational institutions providing
pre-primary, primary, secondary, tertiary, special, adult, vocational, technical
science or religious education, including booklets, brochures, pamphlets and
leaflets, newspapers, journals and periodicals, children's books, picture and
painting books, music (printed, duplicated or manuscript), maps, charts and
topographical plans, covers, cases and other articles supplied together with
the books;
Nigeria Tax Act, 2025 2025 No. 7 A 493
"educational materials" means materials used for instructional purposes,
for active learning, assessment and administration, including physical or
electronic materials used to implement instruction and facilitate learning in
educational institutions providing pre-primary, primary, secondary, tertiary,
special, adult, vocational, technical science, or religious education;
"equipment" means tools, which may be devices, machines or special-
ised industrial vehicles that assist a person in achieving an action beyond the
normal capabilities of a human;
"exported goods" means goods produced or procured for commercial
purposes by a person in Nigeria and supplied to a person outside Nigeria;
"farming machinery and implements and farming transportation
equipment" means equipment used exclusively for farming or for any other
agricultural production including tractors, ploughs, harrows, ridgers, har-
vesters, and equipment of the same kind;
"fertilisers" means all fertilisers for agricultural purposes;
"humanitarian donor funded projects" includes projects undertaken by
Non-Governmental Organisations and religious and social clubs or societies
recognised by law whose activity is not for profit and in the public interest;
"locally produced agricultural or veterinary medicines" means –
(a) drugs and vaccines produced in Nigeria for the treatment of animals,
fish and plants including veterinary pharmaceuticals in various prescription
presentations, veterinary nutraceuticals in various prescription presentations,
veterinary biological vaccines, anti-sera, plasma, bacterins, hormones, toxoids,
veterinary biosecurity for example, disinfectants, antiseptics, feed sanitizers
and water sanitizers;
(b) drugs and vaccines produced in Nigeria for treatment of fishes including
dietary supplements for fishes including feed grade amino acids as single
biochemical for example, lysine, methionine, tryptophan, feed grade minerals
as single entity, feed grade vitamins as single entity, feed grade enzymes,
feed grade inorganic compounds as single entity for example, calcium
phosphate, vaccines for fishes including killed vaccines, attenuated vaccines,
deoxyribonucleic vaccines, acid (DNA) vaccines, recombinant vector
vaccines, subunit vaccines, genetically modified vaccines, synthetic peptide
vaccines; and
(c) drugs and vaccines produced in Nigeria for treatment of plants such
as chemical crop protection products commonly referred as pesticides or
agro-chemical including insecticides, rodenticides, fungicides, herbicides, anti-
sprouting products and similar products;
"locally produced animal feeds" means feeds for poultry, cattle or
fish;
"machinery" means a mechanical device or the parts that operate together
A 494 2025 No. 7 Nigeria Tax Act, 2025
to perform a single task, including the accessories necessary to the working
of a machine;
"medical equipment" means devices requiring calibration, maintenance,
repair, user-training and decommissioning, medical equipment used for the
specific purposes of diagnosis and treatment of disease or rehabilitation
following disease or injury, used either alone or in combination with any
accessory, consumable or other piece of medical equipment, including vet-
erinary equipment and devices, excluding cosmetology or fitness devices
and other similar devices;
"medical products" means articles, instruments, apparatus, machine or
software used in the prevention, diagnosis or treatment of illness or disease,
or for detecting, measuring, restoring, correcting or modifying the structure
or function of the body for some health purpose which include implantable,
disposable or single-use medical devices but excludes cosmetology or fitness
devices and other similar devices;
"medical services" means healthcare services for both humans or
animals, rendered by a qualified health practitioner, excluding cosmetology,
spa, gymnasium or similar services;
"pharmaceutical products" means components or finished products of
both modern and traditional medicine intended for human use in the diagnosis,
cure, mitigation, or treatment of disease or injury, and prevention of disease
provided such products are approved by the relevant regulatory authority;
"plant" refers to an assemblage of fixtures, tools, machinery, and
apparatus which are necessary to carry on a trade or industrial business,
including land, buildings, specialised structures, and equipment purchased
off a shelf as a whole or an accumulation of parts which form a plant
following a process of construction, installation, assemblage and transformed
into a state for usage at the site of business;
"purchase" means to obtain, acquire or take possession of a given asset,
property, item or right by paying money or money's worth;
"utilisation of gas in downstream petroleum operations" means the marketing
and distribution of natural gas for commercial purposes, and includes its use
in power generation, liquefied natural gas production, gas to liquid production
or fertiliser plants, and gas distribution pipelines;
"shared passenger road-transport service" means passenger road-
transport service which is available for use by the general public excluding
leased, hired or rented motor vehicles, transportation apparatus for business
or private use, car or ride hailing;
"water" means natural water and table water, spring water, rain water,
pipe borne water, well water and all-natural water of the same kind, all table
water other than sparkling or flavoured water, except water sold –
Nigeria Tax Act, 2025 2025 No. 7 A 495
(a) in restaurants, hotels, eateries, lounges, cafes, canteens and other
similar settings; and
(b) by contractors, caterers and other similar vendors.
CHAPTER NINE
GENERAL PROVISIONS

(1) The following rules shall apply in the event of restructuring of Business
trades or businesses – restructuring
(a) in the case of a merger of two or more trades or businesses –
(i) a new trade or business shall not be deemed to have commenced
as a result of the merger, and the provisions of this Act as they relate to
cessation of trade or business shall not apply to the trade or business that
ceased as a result of the merger,
(ii) the provisions of Part VIII of Chapter Two of this Act as they
relate to chargeable gains shall not apply to the assets transferred to the
new or surviving trade or business as a result of the merger,
(iii) assets of the merging trades or businesses shall be deemed to
have been transferred at the residue of the qualifying capital expenditure
on the day following the merger,
(iv) the provisions of the First Schedule to this Act shall apply on the First
remaining useful life of the asset transferred as a result of the merger, Schedule
(v) unutilised capital allowance on the assets transferred shall be
available for the use of the new or surviving trade or business,
(vi) unabsorbed losses of the merging entities shall be available to the
surviving trade or business provided that such losses were incurred by
the merged trade or business, and
(vii) taxes deducted at source in respect of the merged trades or
businesses shall be available to the merged trade or business;
(b) in the case of a sale or transfer of a trade or business which results
into the cessation of a trade or business –
(i) the provisions of Part V of Chapter Two of this Act as regards
cessation of trade, business, profession or vocation shall apply to the
trade or business that was sold or transferred,
(ii) for the purposes of the First Schedule to this Act, the asset sold or
First
transferred shall be recognised at the value at which they are sold or Schedule
transferred,
(iii) the provisions of Part VIII of Chapter two of this Act as they
relate to chargeable gains shall apply on any asset sold or transferred,
(iv) unutilised capital allowance on the assets sold or transferred shall
not be available for use in the new or surviving trade or business,
A 496 2025 No. 7 Nigeria Tax Act, 2025
(v) unabsorbed losses of the old business shall not be available for use
in the new or surviving trade, business, profession or vocation, and
(vi) taxes deducted at source from the old trade or business, shall not
be available for use by the new or surviving trade or business;
(c) in the case of a sale or transfer of a business asset which does not
result into the cessation of the trade or business, and where the parties
agreed to sell or transfer the asset for an amount not exceeding the sum of
the residue of the qualifying capital expenditure and unutilised capital
allowance of the asset –
First (i) capital allowance under the provisions of the First Schedule to this
Schedule Act shall apply to the residue of the asset only,
(ii) the unutilised capital allowance on the asset sold or transferred
shall be available for use by the buying trade or business,
(iii) the trade or business that sold or transferred the assets shall not
claim any part of the unutilised capital allowance pertaining to the asset
sold or transferred, and
(iv) the provisions of Part VIII of Chapter Two of this Act as regards
chargeable gains shall not apply to the asset sold or transferred under
this paragraph.
(2) Notwithstanding the provisions of subsection (1), in the case of
companies engaged in upstream petroleum operations, where business
restructuring results in the formation of a new company and cessation of the
old business, the accounting period of the company acquiring that trade or
business shall commence on –
(a) the date on which the sale or transfer of the trade or business to the
new company takes place; or
(b) such date within the calendar month in which the sale or transfer
takes place, as may be elected by the company with the approval of the
Service, and end on 31 December of the same year, provided that any gap
between the old and surviving business shall be treated as being part of the
new or surviving company.
(3) The period referred to in subsection (2), shall constitute "Accounting
Period" under Chapter Three of this Act.
(4) The relevant tax authority shall be notified of any restructuring of a
trade, business, profession or vocation prior to commencing such arrangement.
(5) Reference to a trade or business in this section include references to
any part of the trade or business.
(6) VAT charged under Chapter Six of this Act shall not apply to business
restructuring carried out in accordance with this Act.
Nigeria Tax Act, 2025 2025 No. 7 A 497
(7) Where a business or a part of the business, which is capable of
separate operation is transferred as a going concern and the purchaser uses
the assets in the same kind of business, such transfer shall not be treated as a
supply of goods or services for the purposes of VAT, provided that the pur-
chaser is registered in accordance with Part II of the Nigeria Tax Administra-
tion Act, 2025 , or registerable as a result of the transfer.

(1) Where a relevant tax authority is of the opinion that a disposition Artificial
is not given effect to, or that a transaction which reduces or may reduce the transactions
amount of tax payable, is artificial or fictitious, it may disregard any such
disposition or transaction, or direct that such adjustments be made with re-
spect to liability to tax as it considers appropriate, to counteract the reduction
of liability to tax and issue an assessment or additional assessment accord-
ingly.
(2) The provisions relating to objections and appeals under Chapter Four
of the Nigeria Tax Administration Act, 2025 , shall apply to a direction made
under this section.
(3) For the purpose of this section –
(a) "disposition" includes any trust, grant, covenant, agreement or
arrangement; and
(b) a transaction between connected persons shall be deemed to be
artificial or fictitious if, in the opinion of the relevant tax authority, the
transaction has not been made at arm's length.

(1) A company involved in an arrangement with a related party Transactions
shall – between
related
(a) ensure that the terms and conditions for which the arrangement is parties to be
carried out is at arm's length; and at arm's
length
(b) report the arrangement in the form and manner prescribed by the
relevant tax authority.
(2) Where, in the opinion of a relevant tax authority, a company has
entered into an arrangement with a related party which is not at arm's length,
it may effect necessary adjustments to bring the arrangement in conformity to
arm's length terms as provided under the Transfer Pricing Regulations.
(3) The relevant tax authority may make rules or regulations for the
administration of this section.
(4) For the purposes of this section –
(a) an "arrangement" includes any agreement, understanding, scheme,
financial or commercial relation, transaction or series of transactions; and
(b) "arm's length terms and conditions" means such terms and condi-
tions obtainable if the transaction or arrangement was between unrelated
parties dealing in comparative circumstances.
A 498 2025 No. 7 Nigeria Tax Act, 2025

(1) Where a deduction has been allowed under the provisions of this
refund of Act in respect of any liability or any expense incurred and the liability is waived
liability or
or released or such expense is refunded in whole or in part, the amount of that
expenses
liability or expense which is waived, released or refunded, shall be an income
on the day of the waiver, release or refund.
(2) Where any liability or expenditure of capital nature is waived, it shall
constitute a chargeable gain for the purposes of Part VIII of Chapter Two of
this Act.
n

(1) In this Act, references to incomes, profits or gains charged or
tal chargeable to tax include references to profits, incomes or gains taxed or
taxable by deduction at source.
(2) For the purposes of any computation under this Act, any method of
apportionment adopted shall be just and equitable and consistently applied under
similar circumstances.

The Service may, with the approval of the Minister, make regulations
make
to give effect generally to the provisions of this Act.
regulations

From the commencement of this Act, the following enactments are
repealed (repealed enactments) –
(a) Capital Gains Tax Act, Cap. C1, Laws of the Federation of Nigeria,
2004;
(b) Casino Act, Cap. C3, Laws of the Federation of Nigeria,2004;
(c) Companies Income Tax Act, Cap. C21, Laws of the Federation of
Nigeria, 2004;
(d) Deep offshore and Inland Basin Act, Cap. D3, Laws of the Federation
of Nigeria, 2004;
(e) Industrial Development (Income Tax Relief) Act, Cap. I17, Laws of
the Federation of Nigeria,2004;
(f) Income Tax (Authorised Communications) Act, Cap. I4, Laws of the
Federation of Nigeria, 2004;
(g) Personal Income Tax Act, Cap. P8, Laws of the Federation of
Nigeria,2004;
(h) Petroleum Profits Tax Act, Cap. P13, Laws of the Federation of
Nigeria,2004;
(i) Stamp Duties Act, Cap. S8, Laws of the Federation of Nigeria, 2004;
(j) Taxes and Levies (Approved List for Collection) Act, Cap. T2, Law
of the Federation of Nigeria, 2004 ;
(k) Value Added Tax Act, Cap. V1, Laws of the Federation of Nigeria,
2004; and
Nigeria Tax Act, 2025 2025 No. 7 A 499
(l) Venture Capital (Incentives) Act, Cap. V2, Laws of the Federation of
Nigeria, 2004.

(1) The Petroleum Industry Act, No. 6, 2021 is amended by Consequen-
deleting – tial amend-
ments
(a) Part I – X of Chapter Four;
(b) the Fifth and Sixth Schedules;
(c) paragraphs 6, 9, 10, 11 and 12, of the Seventh Schedule; and
(d) paragraph 14 (6) of Part IV of the Seventh Schedule.
(2) The Nigeria Export Processing Zones Act, Cap. N107, Laws of the
Federation of Nigeria, 2004 is amended by deleting sections 8 and 18(1)(a).
(3) The Oil and Gas Export Free Trade Zone Act, Cap. O5, Laws of the
Federation of Nigeria, 2004 is amended by deleting sections 8 and 18(1)(a).
(4) The National Information Technology Development Agency Act, No.

(1) The Value Added Tax Act (Modification) Order, 2021 is revoked.
and
consequen- (2) The Companies Income Tax (Significant Economic Presence) Order,
tial amend-
is amended by deleting paragraph 2.
ment of
subsidiary (3) The Petroleum (Drilling and Production) Regulations, 1969 is amended
legislation
by deleting regulations 60B, 60C, 61(1), (2), (4), and 62.
Savings 199. Without prejudice to the provision of section 6 of the Interpretation
provisions
Act –
(a) the repealed enactments specified in section 196 and the amended
enactments specified in section 197 of this Act shall not affect anything
done under the enactments;
(b) a notice, guideline, rule, order, regulation, circular or other subsidiary
legislations made or issued under any provision of the repealed or amended
enactments by this Act, shall continue to be in force as if they had been
made or issued by the relevant authority or person under this Act except to
the extent that it is inconsistent with the provisions of this Act;
(c) an enforcement process or legal proceedings commenced or pending
prior to the commencement of this Act, in connection with imposition of tax,
contravention or non-compliance with the repealed or amended enactments,
shall continue and be disposed of, as if it was commenced under this Act;
and
(d) anything made or done, or having effect as if made or done, before
the date of commencement of this Act under any provision of the repealed
or amended enactments by the relevant tax authority, and having any
continuing or resulting effect with respect to the taxation of a taxable person
or any matter connected, shall be treated as if it was done or performed by
the relevant tax authority under this Act.
Exercise of 200. The discharge of the duties and obligations, as well as the exercise
powers, of powers and rights conferred by this Act shall, to the extent not provided in
duties and
this Act, be in accordance with the provisions of the Nigeria Tax Administration
obligations
Act, 2025.

Without prejudice to the provision of section 6 of the Interpretation
provisions
Act –
(a) the repealed enactments specified in section 196 and the amended
enactments specified in section 197 of this Act shall not affect anything
done under the enactments;
(b) a notice, guideline, rule, order, regulation, circular or other subsidiary
legislations made or issued under any provision of the repealed or amended
enactments by this Act, shall continue to be in force as if they had been
made or issued by the relevant authority or person under this Act except to
the extent that it is inconsistent with the provisions of this Act;
(c) an enforcement process or legal proceedings commenced or pending
prior to the commencement of this Act, in connection with imposition of tax,
contravention or non-compliance with the repealed or amended enactments,
shall continue and be disposed of, as if it was commenced under this Act;
and
(d) anything made or done, or having effect as if made or done, before
the date of commencement of this Act under any provision of the repealed
or amended enactments by the relevant tax authority, and having any
continuing or resulting effect with respect to the taxation of a taxable person
or any matter connected, shall be treated as if it was done or performed by
the relevant tax authority under this Act.
n

The discharge of the duties and obligations, as well as the exercise
powers, of powers and rights conferred by this Act shall, to the extent not provided in
duties and
this Act, be in accordance with the provisions of the Nigeria Tax Administration
obligations
Act, 2025.

(1) Subject to the Constitution of the Federal Republic of Nigeria,
with other this Act shall take precedence over any other law with regards to the imposition
laws
of tax, royalty, levy, surcharge on services and fossil fuel or any other tax,
and where the provisions of any other law is inconsistent with the provisions of
this Act, the provisions of this Act shall prevail and the provisions of that other
law shall, to the extent of the inconsistency, be void.
(2) Notwithstanding the provisions contained in any other law –
(a) taxable income, allowable deductions, reliefs or allowances for the
purposes of ascertaining tax due shall be determined only in accordance
with this Act;
Nigeria Tax Act, 2025 2025 No. 7 A 501
(b) any income or profits, gains, assets or transaction which is chargeable
to tax under this Act shall not be subject to any other tax of a similar nature
imposed on the same taxpayer or tax base; and
(c) the Minister may issue regulations or guidelines published in the Official
Gazette for the effective implementation of this subsection.
(3) A person or agency of Government saddled with a duty or obligation
under this Act or under any other law shall, for the purposes of giving effect
to imposition of any tax, levy, royalty, surcharge on fossil fuel, discharge
such duty or obligation in accordance with this Act.

In this Act – General
interpreta-
"accelerator" is as defined in the Nigeria Startup Act, No. 32, 2022 ;
tion
"accounting period" means a period for which accounts have been
made up ;
"ad valorem" means the value of a transaction or property ;
"agency of Government" includes a ministry, department, statutory body,
public authority and an institution of the Federal, State and Local Government;
"approved Agent'' means any person approved by the Securities and
Exchange Commission to function as an intermediary for the conduct of a
regulated securities lending transaction ;
"aggregate covered tax paid" means the addition of the income taxes
paid by a company for a year of assessment under this Act;
"agricultural trade or business" means –
(a) primary crop production comprising the production of raw and semi-
processed crops of all kinds, but excluding any intermediate or final processing
of crops or any other associated manufactured or derivative crop product ;
(b) primary livestock production comprising the production of live animals
and their direct produce such as live or raw meat, live or raw poultry, fresh
eggs and milk of all kinds, but excluding any other associated manufactured
or derivative livestock product ;
(c) primary forestry production comprising the production of timbers of
various kinds such as firewood, charcoal, uncultivated materials gathered
and other forestry products of all kinds, including seeds and saplings, but
excluding the intermediate and final processing of timber and any other
manufactured or derivative timber product ; and
(d) primary fishing production comprising the production of fish of all
kinds, including ornamental fish, but excluding any intermediate or final
processing of any other manufactured or derivative fish product;
"angel investor" is as defined in the Nigeria Startup Act, No 32, 2022;
"assessable income" means assessable income determined under the
provisions of chapter two of this Act ;
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"authorised officer" means an officer who has been authorised by a
tax authority to perform any function under this Act;
"bank'' means a bank as defined under the Banks and Other Financial
Institutions Act, Act No. 3, 2020 ;
"banking" means business conducted or services offered by a bank ;
"beneficial owner" means a person who has ownership, control, rights,
indirect benefit or beneficial interest over shares or clients, or over income,
goods, services or assets subject to tax, or on whose behalf a transaction is
carried out ;
"borrower" means an approved borrower in a regulated securities lending
transaction;
"building" means any structure permanently affixed to land for all or
most of the useful life of that structure and shall include a house, garage,
dwelling apartment, hospital and institutional building, factory, warehouse,
theatre, cinema, store, mill building and similarly fixed structure affording
protection and shelter, but excludes any fixtures or structures that can easily
be removed from such land, such as radio and television masts, transmission
lines, cell towers, vehicles, mobile homes, caravans and trailers ;
"chargeable gains" has the meaning given in section 33 of this Act ;
"company" a company or corporation, including limited liability
partnership, established by or under any law in force in Nigeria or
elsewhere ;
"commencement of business'' means the starting of operation of a
business ;
"commencement date" means the date that an entity carries out its first
transaction which shall be the earliest of the date it –
(a) begins to market or first advertises its products or services for sale ;
(b) obtains an operating license from a regulatory authority in Nigeria ;
(c) first sale or purchase ;
(d) execute its first trading contract after incorporation ;
(e) issues or receives its first invoice ;
(f) delivers or receives its first consignment of goods ; or
(g) first renders services to its customers ;
"communication infrastructure'' means telecommunications fibre optics,
satellite cellular networks, broadband systems radio transmission towers,
undersea cables and other similar infrastructure;
"compensating payments'' means any payments made in lieu of interest
or dividend under a regulated securities lending transaction ;
"connected persons" includes in the case of –
(a) individuals, the individuals are married or are relatives ;
Nigeria Tax Act, 2025 2025 No. 7 A 503
(b) a trustee in relation to a settlement, the trustee and the settlor, or the
spouse or a relative of the settlor;
(c) a partnership, a person is related to the person, or spouse or a close
relative of the person with whom he is in partnership ;
(d) a company –
(i) a person is connected to a company of which he, or his spouse or
a close relative has control,
(ii) a company is connected to another company where the same
person has control over both companies, or connected persons acting
separately have control over the companies,
(iii) a company is connected to two or more persons who acting
together, or through a person acting on their directions exercise control
over the company,
(iv) two companies are connected where one company participates
directly or indirectly in the management, control or capital of the other
company, or the same persons participate directly or indirectly in the
management, control or capital of a company and another company;
(e) other cases, two persons are connected where –
(i) one may reasonably be expected to act in accordance with the
directions, requests, suggestions, or wishes of the other person,
(ii) both persons may reasonably be expected to act in accordance
with the directions, requests, suggestions, or wishes of a third person, or
(iii) one person has the practical ability to control the business decisions
of another person :
Provided that two persons are not connected solely by reason of the fact
that one person is the employee or client of the other, or both persons are
employees or clients of a third person ;
"constituent entity" means any company, permanent establishment or
business unit that is a member of a multinational enterprise ;
"conveyance on sale" means the transfer of interest in real property,
being land and building, only ;
"digital assets" means digital representation of value that can be digitally
exchanged, including crypto assets, utility tokens, security tokens, non-fungible
tokens (NFT), such other similar digital representation or derivatives of any
of the listed or similar assets and any other asset as may be defined by the
relevant regulatory authority ;
"disposal of assets" has the meaning assigned to it under section 35 (1)
of this Act ;
"economic development incentive certificate" means a certificate issued
under this Act certifying, among other things, a company to be a priority
A 504 2025 No. 7 Nigeria Tax Act, 2025
company, or any such certificate as amended under this Act ;
"employment" includes any appointment or office, whether public or
otherwise, for which remuneration is payable ;
"entertainment" includes any exhibition and performance in which
admission of people is subject to payment by such persons but does not
include the following –
(a) play on stage and performance which are carried out by govern-
ment-approved educational institutions as part of learning ;
(b) sport, game or other cultural performance sponsored by
Government ;
(c) entertainment sponsored by a charitable, educational, medical, scientific
or cultural institution of a public character; and
(d) entertainment organised by a non-profit making, charitable, educational,
medical, scientific or cultural society registered under the law where the
entertainment is in furtherance of the objectives of the society ;
"executor" includes any person administering the estate of a deceased
person ;
"exported service'' means a service rendered to a non-resident person
outside Nigeria by a taxable person regardless of where the service is
rendered, provided that a service rendered to the Nigerian permanent
establishment of a non-resident person shall not qualify as exported
service ;
"family income" refers to any income accruing to a family from all
sources;
"foreign company" means a non-resident company or any company
other than a Nigerian company;
"financial institutions'' includes depository institutions, custodial institu-
tions, investment institutions and insurance companies;
"finance lease'' means a lease arrangement where the lessee effec-
tively assumes most of the risks and rewards associated with asset
ownership;
"financial services'' includes depository services, custodial services,
investment services and insurance services;
"government" means the Federal Government, State Government or
the Federal Territory or the Local Government Council;
"goods' for the purposes of Chapter Six of this Act, means all forms of
tangible properties, movable or immovable;
"gross turnover" means the gross inflow of economic benefits during
the period arising in the course of the operating activities of an entity when
those inflows result in increases in equity including sales of goods, supply of
Nigeria Tax Act, 2025 2025 No. 7 A 505
services, receipt of interest, rents, royalties or dividends other than increases
relating to contributions from equity participants;
"hire purchase" means a financial arrangement in which a person
acquires immediate use of an asset by making regular instalment payments
over a specified period and may gain ownership of the asset on the comple-
tion of the payments;
"import" means bringing in goods and services from another country or
from an export processing zone;
"importer" means any person who imports goods;
"individual" includes a corporation sole and a body of individuals but
does not include a company, partnership, community, family, trustee or
executor or any body of trustees, executors or legal arrangements;
"income from investing activities" includes dividend, interest, royalty
and any other income of similar nature;
"income tax" means any tax chargeable under Chapters Two and Three
of this Act;
"incubator" is as defined in the Nigeria Startup Act, No. 32, 2022;
"instrument" includes any document relating to transactions consum-
mated through conventional, electronic or other means;
"insurance" includes assurance;
"investor in gas pipeline" means a person issued a gas transportation
pipeline licence by the Nigerian Midstream and Downstream Petroleum
Regulatory Authority, with the exclusive right to own, construct, operate
and maintain a gas transportation pipeline within a route, for its own account
and with third party access provisions, or as a common carrier;
"itinerant worker" includes an individual, irrespective of his status, who
works at any time in any state during a year of assessment, other than as a
government security officer, for wages, salaries or livelihood by working in
more than one State and work for a minimum of 20 days in at least three
months of every assessment year;
"invoice" includes any document issued as evidence of demand for
payment;
"labelled startup" is as defined in the Nigeria Startup Act No. 32, 2022;
"land" means the earth's crust, or parcelled plots;
"lender'' means an approved lender in a regulated securities lending
transaction;
"manufacturer" means any person who engages in the production of
goods who manufactures for or on behalf of other persons;
"manufacturing" means a process by which a commodity is finally
produced, including assembling, bottling, mixing, blending, grinding, cutting,
A 506 2025 No. 7 Nigeria Tax Act, 2025
bending, twisting and joining or any other similar activity;
"Minister" means the Minister responsible for finance;
"minimum effective tax rate" means rate of 15% ;
"mining operations" means any trade or business, other than petroleum
operations, involving the exploitation or extraction of mineral resources
situated in the territory of the Federal Republic of Nigeria;
"MNE" means multinational enterprise;
"MNE group" means any group that includes two or more enterprises
the tax residence for which is in different jurisdictions, or includes an enterprise
that is resident for tax purposes in one jurisdiction and is subject to tax with
respect to the business carried out through a permanent establishment in
another jurisdiction;
"mortgage" means a security by way of deposit of real property for the
payment of any definite and certain sum of money advanced including any
agreement accompanied with a deposit or pledging of title deeds for making
a mortgage, or any other security of any land, estate, or property comprised
in title deeds;
"multinational enterprise" means a company that carries on business
in more than one country or jurisdiction through subsidiary companies,
associated companies, permanent establishments or any other business units
located in those countries or jurisdictions;
"multinational group" means MNE group;
"National Minimum Wage" means the extant minimum wage prescribed
by the National Minimum Wage (Amendment) Act 2024;
"Nigeria" means the Federal Republic of Nigeria, and when used in a
geographical sense, includes the territorial waters of the Federal Republic
of Nigeria, and any area outside the territorial waters, including the continental
shelf, which in accordance with international law has been or may be
designated, under the law of the Federal Republic of Nigeria, as an area
within which the right of the Federal Republic of Nigeria with respect to the
seabed, its subsoil, its superjacent waters and their natural resources may
be exercised now and in the future;
"Nigerian company" means a company –
(a) formed, registered or incorporated under any law in Nigeria;
(b) whose central place of management or control is Nigeria; or
(c) whose effective place of management or control is Nigeria;
"non-resident" means non-resident person, individual or company, as the
context requires;
"non-resident individual" means an individual that, in any year of
assessment –
Nigeria Tax Act, 2025 2025 No. 7 A 507
(a) is not domiciled in Nigeria;
(b) has no permanent place available for his domestic use in Nigeria;
(c) has no place of habitual abode in Nigeria;
(d) has no substantial economic and immediate family ties in Nigeria;
(e) sojourns in Nigeria for a period or periods amounting to an aggregate
of less than 183 days in a 12-month period inclusive of annual leave or
temporary period of absence ; and
(f) is not serving as a diplomat or diplomatic agent of Nigeria in another
country.
"Official Gazette" means the Federal Government Gazette or the Gazette
of any State in the Federation;
"official market rate" means currency exchanged market approved by
the Central Bank of Nigeria;
"operating lease" means an arrangement involving the transfer of the
right to use an asset by the lessor in return for rental payments from lessee
over an obligatory period but the asset is not wholly amortised during the period;
"owner" means in respect of any goods, aircraft, vessel, vehicle, plant or
any other goods, a person, other than an officer acting officially or agent, who
holds out himself to be the owner, or the person in possession of beneficial
interest in, or having control of or power of disposition over the goods, aircraft,
vessel, vehicle, plant or other goods;
"participation, directly or indirectly, in the management, control, or
capital of the other person" means where a person either alone or together
with an associate or associates under another application of this section controls
either directly or through one or more interposed persons, 30% or more of the
voting right, the right to dividends or income entitlements payable or the right to
capital in another person;
"partnership" means an association, or a body of two or more persons
who have agreed to combine their rights, powers, property, labour or skill for
the purpose of carrying on a trade or business and sharing the profit;
"permanent establishment" means taxable presence of a non-resident
person, and shall include permanent establishment as defined in section 17 of
this Act;
"permissible by-products" means goods or services described in a cer-
tificate issued under section 171 of this Act being goods or services necessar-
ily or ordinarily produced in the course of producing a priority product;
"person" includes a company, partnership, community, family, individual,
executor, trustee and legal arrangement;
"personal representatives" means the legal personal representatives of
a deceased person;
A 508 2025 No. 7 Nigeria Tax Act, 2025
"policy of insurance" means an instrument by which a contract of
insurance is made or agreed to be made, or is evidenced, excluding cover
notes, slips or other documents made in anticipation of the issue of an insurance
policy, and documents embodying alterations of the terms or conditions of an
insurance policy, and the expression "insurance" includes assurance ;
"policy of life insurance" means a policy of insurance upon any life or
lives or upon any event or contingency relating to or depending upon any life or
lives;
"policy of insurance against personal injury" means a policy of in-
surance for any payment agreed to be made as compensation for personal
injury, including policies of insurance or indemnity against liability incurred by
employers in consequence of claims made upon them by workmen who have
sustained personal injury;
"policy of marine insurance" means any formal contract whereby an
insurer undertakes to indemnify an insured against losses incident to marine
adventure, and includes any contract relating to insurance of a ship or the
machinery or fittings belonging to the ship while under construction or repair or
on trial;
"priority company" means a company issued an economic develop-
ment incentive certificate;
"priority business" in relation to a priority company, means the produc-
tion and sale of its relevant priority product or products;
"priority industry" means any trade or business of any kind specified in
the Tenth Schedule to this Act;
"priority product" means goods or service of any kind specified in the
Tenth Schedule to this Act;
"professional services" means services provided by an individual or a
firm having specialised knowledge, skills, and qualifications in specific fields,
including consulting, planning, or support services, excluding artisans or
vocational services;
"public character" with respect to any organisation or institution means
organisation or institution –
(a) that is registered in accordance with relevant law in Nigeria; and
(b) does not distribute or share its profit in any manner to members or
promoters;
"public fund" means any fund set up by any government or a govern-
mental body in Nigeria to finance a specific service, project, or obligation of
Government to the public;
"real estate investment company'' means a company duly approved by
the Securities and Exchange Commission to operate as a real estate investment
scheme in Nigeria;
Nigeria Tax Act, 2025 2025 No. 7 A 509
"receipt" includes a note, memorandum, writing or electronic inscription
whereby money, a bill of exchange or promissory note for which money is
acknowledged or expressed to have been received, deposited or paid, or whereby
a debt or demand, or any part of a debt or demand is acknowledged to have
been settled, satisfied or discharged, or which signifies or imports any such
acknowledgement, and whether the same is or is not signed with the name of
a person;
"regulated securities lending transaction'' means any Tenth Schedule
securities lending transaction conducted under rules made by the Securities
and Exchange Commission;
"related parties" has the same meaning as connected persons, and
unconnected, non-related or unrelated party shall be construed accordingly;
"relative" means brother, sister, ancestor or lineal descendant;
"relevant priority product" in relation to any priority company, means
priority product and the permissible by-products specified in a priority certificate;
"relevant tax authority" is in accordance with the provision of this Act
and section 3 of the Nigeria tax Administration Act, 2025 ;
"remainder of assessable income" means the total assessable income
of an individual less the deductions under section 28(2) of this Act;
"remainder of assessable profit" means the total assessable profit of a
company less the deductions under section 27(5) of this Act, in the case of a
company;
"rent" means payments of any kind, received or receivable, paid or
payable, for the use of, or the right to use property or equipment of any kind,
and shall include remuneration for the use, letting, hire or use in any other form
of movable or immovable property;
"resident" means resident person, individual or company;
"resident company" means a Nigerian company;
"resident individual" means an individual that, in any year of
assessment –
(a) is domiciled in Nigeria ;
(b) has a permanent place available for his domestic use in Nigeria ;
(c) has place of habitual abode in Nigeria;
(d) has substantial economic and immediate family ties in Nigeria;
(e) sojourns in Nigeria for a period or periods amounting to an aggregate
of not less than 183 days in a 12-month period inclusive of annual leave or
temporary period of absence; or
(f) serves as a diplomat or diplomatic agent of Nigeria in another country;
"royalties" includes payments of any kind, received as a consideration
for–
A 510 2025 No. 7 Nigeria Tax Act, 2025
(a) the use of, or the right to use –
(i) any copyright (including the copyright of literary, artistic, scientific
work, broadcasts, motion picture films and works on films, films or other
means of image or sound transmission or reproduction for use in connec-
tion with radio or television broadcasting),
(ii) any patent, trademark, design or model, plan, or secret formula or
process ; or
(iii) industrial, commercial or scientific equipment ; or
(b) information concerning industrial, commercial or scientific experi-
ence; or
(c) for the use of, or the right to use, any software, or paid as a consideration
for the acquisition of any copy of software for the purposes of using it.
"Service'' means the Nigeria Revenue Service established under Nigeria
Revenue Service (Establishment) Act, 2025;
"services" for the purposes of Part IV of Chapter Eight of this Act,
means –
(a) anything, other than goods, or services provided under a contract of
employment; and
(b) includes any intangible or incorporeal (product, asset or property)
over which a person has ownership or rights, or from which he derives benefits,
and which can be transferred from one person to another;
"small company" means a company that earns gross turnover of
N 50,000,000 or less per annum with total fixed assets not exceeding
N 250,000,000, provided that any business providing professional services shall
not be classified as a small company;
"supplies" means any transaction, whether it is the sale of goods or the
performance of a service for a consideration;
"supply of goods" means any transaction where the property in the
goods is transferred or where the agreement expressly contemplates that this
will happen and in particular includes the sale and delivery of taxable goods,
the letting out of taxable goods on hire or leasing, and any disposal of taxable
goods;
"supply of services" means any service provided for a consideration;
"tax" means any imposition, duty, levy, royalty or revenue accruing to
government in full or in Part under this Act or any other law ;
"tax ID" is as provided for under Nigeria Tax Administration Act, 2025;
"taxable person" includes a company, individual or body of individuals,
family, community, corporations sole, trustee, executor or any other legal
arrangement, or any person who earns income, or carries out an economic
activity, a person exploiting tangible or intangible property for the purpose of
Nigeria Tax Act, 2025 2025 No. 7 A 511
obtaining income therefrom by way of trade or business, or any person or
agency of government acting in that capacity;
"taxable supplies'' means any transaction for sale of goods or the
performances of a service, for a consideration;
"trade or business" means any activity or venture from which income
is generated, for whatever scale or period it is carried on, but does not include
employment ;
"transaction at arm's length" means a transaction on normal open
market commercial terms;
"vehicle" includes for the purpose of this Act every description of
conveyance for the transportation by land of human beings or goods ;
"venture capitalist" is as defined in the Nigeria Startup Act No. 32,
2022;
"vessel" means a mode of transportation or conveyance by water, of
human beings or goods ; and
"year of assessment" means government tax year being 1 January to 31
December of any year.

This Act may be cited as the Nigeria Tax Act, 2025 and shall come Citation
into effect on the first day of January, 2026.