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Find below simple  guidelines to to make payment for to Nigeria; Federal Inland Revenue Service (FIRS):

  • Taxpayers must be registered with relevant Tax Office nearest to them and obtain a Taxpayer Identification Number (TIN).
  • Taxpayers should render appropriate tax returns.
  • Taxpayers should obtain Assessment and Demand Notices were applicable.
  • Taxpayers should remit all taxes to the approved collecting Banks in the various forms so designed for such purposes and obtain an Electronic Ticket (e-ticket).
  • Taxpayers should present the e-ticket for the issuance of FIRS official receipts.
  • Taxpayers can now process their Tax Clearance Certificate accordingly.


The Taxpayer Identification Number (TIN) is a unique number allocated and issued to identify a person (Individual or Company) as a duly registered Taxpayer in Nigeria.  It is for use by that Taxpayer ALONE.  Registration for tax purposes is a legal obligation of every person who is required to pay tax in Nigeria.
The following necessary details for obtaining and updating TIN should be presented to the Tax Office nearest to the address of the Taxpayer.


For a Company, Enterprise or Business registered with the Corporate Affairs Commission (CAC)
1.            Duly completed Application form for TIN;
2.            EITHER Certificate of Incorporation (for a Company) OR Business Name Registration Certificate (for an Enterprise & Business) showing clearly the Registration Number in each case;
3.            Documents containing the following information:
 i.              ADDRESS of Company, Enterprise or Business;
ii.             Principal LOCATION of business;
iii.            DATE of COMMENCEMENT of business.
For an Individual who (or whose business) is not registered with the CAC
1.            Duly completed Application form for TIN
2.            Any of the following valid (current) identification documents:
·         International Passport;
·         National Identity Card;
·         Staff Identity Card (employed persons);
·         National Driver’s License.
The following RULES are important:
(i)            All information marked * on the application form MUST be provided;
(Ii)          The characters of the NAME i.e. letters and other symbols constituting the name MUST NOT exceed two hundred (200);
(iii)          The characters of the ADDRESS also MUST NOT exceed two hundred (200);
(iv)         Email address must be UNIQUE and ACTIVE;
(v)          Mobile Telephone Number MUST be eleven (11) digits e.g. (08763201210).
Updating TIN under the ‘National Single Window’ System is a requirement for taxpayers with incomplete records with Federal Inland Revenue Service (FIRS).
TIN may be updated at the Tax Office where it was initially generated by providing the following additional information:
1.            Email Address;
2.            Phone Number.
After updating, the system indicates that “The TIN has been successfully updated”.
The Joint Tax Board TIN (JTB TIN)
It is important for a person to note the following information about the JTB TIN:
(i)            The JTB TIN is designed to subsequently replace the current TIN and is already in use within FIRS and several other States of Nigeria;
(ii)           The major difference is that the JTB TIN has ten (10) digits, it is uniform and general across Nigeria. It is UNIQUE for every registered taxpayer in Nigeria and not limited to FIRS Taxpayers alone;
(iii)          The JTB TIN is presently being issued out at the point of registration and also updated by FIRS and the States which have so far adopted it;
(iv)         Every Taxpayer in Nigeria will ultimately be required to possess and use ONLY the JTB TIN.
TIN validation is the process of confirming that the updated TIN meets the necessary conditions for transacting business with other Organizations such as Nigerian Customs Service (NCS),
Central Bank of Nigeria (CBN), National Agency for Food and Drug Administration and Control (NAFDAC), etc.
A Taxpayer can validate his/her TIN directly on the FIRS Trade Portal i.e. by following the simple procedure and rules below:
(i)            Enter the TIN and the same email address that was provided to the Tax Office when updating;
(ii)           NEXT, enter the security word (captcha) and click on “Validate”;
(iii)          If the validation is successful,  the following confirmation notice shall be displayed:
“Register with NCS – Done”
(iv)         THEN, an automatic email notification from “Nigeria Single Window” with a log-in password and instruction on how to complete the registration process would be sent to the Taxpayer’s email address;
(v)          Upon completing the validation exercise, an email will automatically be sent to the email address provided confirming successful validation. A Taxpayer should therefore check the email including spam folder.
This is for the Taxpayer to re-confirm his/her updated and validated TIN.
A Taxpayer experiencing difficulty in validating TIN (receiving Error Messages) should seek professional assistance from the Tax Office or send email to: or


1 Error in processing your validation request. Contact Web Fountain (WF) Helpdesk under NCS
2 Either your email, name, address or telephone details was not declared to FIRS. Contact FIRS. It might be necessary to update your details at the nearest FIRS office.
3 The information declared to FIRS is invalid Contact FIRS. It might be necessary to update your details at the nearest FIRS office.
4 The TIN information provided does not exist: [XXXXXXXX-XXXX]. Contact WF Helpdesk
5 There is no email declared to FIRS. Contact FIRS to register your email address
6 The Email address provided should be the same as what has been declared to FIRS.
·         Verify that you have entered the correct TIN number and the right email address.
·         If this error persists, verify with FIRS that you have given the correct Email address.
7 The Email address provided should be the same as what has been declared to FIRS. Contact FIRS.
8 The Email declared to FIRS is invalid Contact FIRS to register a valid email.
9 There is no address declared to FIRS. Contact FIRS
10 The Address declared to FIRS is invalid. Contact FIRS
12 There is no phone number declared to FIRS Contact FIRS
13 The phone number declared is not valid. Contact FIRS
14 Company TIN is required Enter your correct TIN in field
15 The Company specified is not valid Check and enter correct format of TIN and email address
16 The name of business declared to FIRS is invalid. Contact FIRS
17 The Company’s RC number is required Contact FIRS to update
18 The Company’s RC number is invalid. Contact FIRS to update
19 Company’s email is not unique. Contact FIRS to update
20 Invalid TIN/Password. Check and re-enter the TIN
21 Error in processing your registration request. Contact WF Helpdesk
22 Your TIN is already registered: [XXXXXXXX-XXXX] Contact WF Helpdesk
23 The entered characters do not match with displayed image.
·         Try again;
·         Check and enter display image
For Enquiries & Clarifications
Executive Chairman
Federal Inland Revenue Service
15, Sokode Crescent, Wuse Zone 5, Abuja Nigeria
Taxpayer Service Policies Processes & Programme Department

+234(0)8115900595; +234(0)8115900596


Question 1     What happens when a taxpayer`s payment is posted to a wrong tax office?
Answer           This can only be possible if the taxpayer does not have a TIN or the bank`s branch teller entered a wrong TIN which is either for another taxpayer or the TIN does not even exist. The system administrator, if informed officially, will reclassify the tax office or such payment.  In cases where the taxpayer does not exist in the database, the registration officer will create the taxpayer and the system will generate a valid TIN for the taxpayer. Also, in cases where the TIN was wrongly assigned to a tax office, the TIN can be redirected to the correct office.
Question 2     How does FIRS prevent issuance of multiple receipts for same payment?
Answer           The automated receipts and credit notes issuance will eliminate issuance of multiple receipts.
Question 3     If a taxpayer gives a cheque to a bank in his office without going to the bank,    how can the taxpayer know whether payment has been made to FIRS account?    
Answer           The taxpayer should insist on the bank delivering the e-ticket to him which will indicate the date and time payment was captured into FIRS account by the bank.
 Question 4     If someone lives in Kaduna and pays his tax there, can he obtain his TCC in Abuja ?         
Answer           No, one can only obtain his/her TCC from the Tax Authority where the person is registered for tax purposes and has been paying his taxes in compliance with the rule of residence as contained in the tax law.
Question 5     Is medical allowance taxed?
Answer           Yes. If it is paid directly to the hospital, Withholding Tax (WHT) should be deducted and if it is given to an employee in the form of allowance, it is taxed under PAYE.
Question 6     Can  a taxpayer pay to any collecting bank branch?
Answer           Yes. There are no designated bank branches for any tax offices or tax types. All approved Lead/Collecting banks can collect for all offices and tax types.
Question 7     What is the process involved in getting back tax payment erroneously credited in the name of the depositor instead of the taxpayer?
Answer           Any tax paid in error can be reversed by the collecting bank within 24 hours if the bank is put on notice within the period. However, if the error was not detected on time, refund can be made by FIRS on request through e-payment platform with the option to use it to set-off future tax.
Question 8     Why does it take more than two weeks to issue TCC even if the taxpayer pays tax in cash?
Answer           TCC can only be issued only after all taxes payable by the taxpayer for the past three preceding years have been paid. The statutory standard of issuing TCC within two weeks is still in force. However, the two weeks start to count only after all taxes have been paid and from the day the taxpayer files application for TCC with the Tax office and not from the date of payment of taxes to the Banks.
Question 9     On what basis will an application for TCC be rejected after two weeks and still be under processing?
Answer           TCC can be rejected on the following grounds:
a.      Where taxes have not been paid
ii      Where penalties or interest is still outstanding
            iii.    Where outstanding returns have not been filed
iv.   Where there are outstanding issues arising from tax queries, audit or      investigation.
            v.      Where the case is with the Tax Appeal Tribunal (TAT) for hearing and part of the tax has not been paid as required
TCC once rejected cannot be said to be still under processing, but it is kept on hold until issues outstanding have been resolved or sorted out by the taxpayer with the relevant office.
Question 10   Is installment Payment no longer allowed for self assessment filers?
Answer           The tax law still recognizes the granting of installment payment to self assessment filers. However, this can only be granted on application by the taxpayer to the tax office.
Question 11   Why does FIRS still refuse to issue TCC after PAYE has been deducted from the staff salary?
Answer           FIRS does not deny issuance of TCC to any taxpayer who has paid his tax liability in full. However, TCC request is rejected where the taxpayer still has outstanding liability to pay.
Question 12   What is Tax avoidance and Tax evasion ?
Answer            Tax Avoidance: – This is considered as a way of identifying the loop hole in the tax law and then taking advantage of such loop hole to reduce the tax payable
   Tax Evasion: –       This is a deliberate and illegal act of the taxpayer not to pay the correct tax
Question 13   What is Accounting year and Accounting period ?
Answer           Accounting Year:-    This is a twelve (12) months period over which an entity`s financial accounts are made-up.
                        Accounting Period:- This simply means the period with reference to which financial accounts of an entity are prepared.
Question 14   Is inclusion of Taxpayer Identification Number (TIN) on a Contractor’s quotation necessary?
Answer           Yes it is mandatory.
Question 15   What is the meaning of due date?
Answer           Due date is the date prescribed by law for filing of tax returns and making of tax payments by taxpayers. All tax types have their different due dates as provided by the relevant tax laws.
                        Due dates for other tax types are as shown below:

                                     DUE DATES OF FILING TAX RETURNS

a) For old companies, six (6) months after the end of the company`s accounting year.
b) For new companies, eighteen (18) months from the date of incorporation or six (6) months after the end of the company`s first accounting period whichever is earlier.
Company`s Income Tax (CIT) Filing Date
2. As in the case of CIT Education Tax (EDT)
3. As in the case of CIT National Information and Technology Development Levy (NITDL) (for applicable companies only)
4. Two (2) months after the commencement of the company`s accounting period
Estimated Petroleum Profit Tax (PPT) Returns
5. Within five (5) months after the end of the company`s accounting period Final PPT Returns
6. 31st March Personal Income Tax (PIT)
7. 31st January Annual Returns of Pay As You Earn (PAYE) (By Employers)
8. 10th of every month PAYE Returns (By Employers)
9. 21st of every month Withholding Tax (WHT)Returns
10. 21st of every month Value Added Tax (VAT)Returns
Question 1     What is P. A. Y. E?
Answer           P. A. Y. E. is an acronym for “Pay As You Earn”. It is a method of collecting personal income tax from employee`s salaries and wages through deduction at source by an employer as provided by the relevant sections of Personal Income Tax Act (PITA). (S.81 of Personal Income Tax Act Cap P8 LFN 2004)
Question 2     What is the due date for remitting PAYE?
Answer           The due date for remitting PAYE is 10th day of every month following month of deduction
Question 3     Why do PAYE charges vary from Ministries to Ministries for the same level of income/salary?
Answer.          PAYE does not differ because the rates used for computation are the same. PAYE rates are as shown in question number 4 below.
Question 4     What are the current tax rates applied on taxable income?
Answer           The current rates applicable to the taxable or chargeable income are as follows:
                                                1st       N300, 000.00 @ 7%
                                                Next    N300,000.00 @ 11%
                                                Next    N500,000.00 @ 15%
                                                Next    N500,000.00 @ 19%
                                                Next    N1,600,000.00 @ 21%
                                                Above  N3,200,000.00 @ 24%
Question 5     Is the submission of comprehensive list of staff with PAYE deductions different from submission of annual returns?
Answer           No. Comprehensive list of employees with PAYE deductions is continuously submitted on monthly basis each time PAYE is being remitted to FIRS, while annual returns (form H1) is to be submitted by 31st day of January of every year by every employer to enable the Tax Authority ascertain whether the correct deductions and payments of tax have been made for the previous year (period of twelve months) for all its employees.
Question 6     What is benefit-in-kind?
Answer           Benefit in kind may be defined as those benefits or perquisites that accrue to a person by reason of office and/or position he/she occupies. Benefits in kind include such benefits as official car, official accommodation, cooks, gardeners, securities etc.  It is taxable after certain deductions/reliefs granted.
Question 7     Where should PAYE deductions of staff working in Abuja but residing in Suleja or Mararaba be remitted to?
Answer           By residency rule, an employee’s PAYE is payable to the Tax Authority of his/her place of residence. It is therefore the duty of the employer to deduct and remit it to the Tax Authority where the employee is resident that is Niger State Internal Revenue Service or Nasarawa State Internal Revenue Service respectively.
Question 8     What is the minimum tax rate for Personal Income Tax?
Answer            The minimum tax rate is 1% of total income. It is applicable if the taxable income is below N300, 000
Question 9     Is it possible to apply for a refund for excess PIT tax deductions/payments ?
Answer           Yes; the law provides that excess tax paid by any employee shall be refunded on application by the employee with the option of set-off against future tax liability.
Question 10   When there is under deduction of tax in the employee’s income, who bears the burden of the under deduction?
Answer           When there is an under deduction of tax in staff salary, the staff whose tax is under deducted bears the burden.
Question 11   What is Gross Emolument/salary?
Answer            Personal Income Tax Act (PITA) as amended defines Gross Emolument as the aggregate of wages, salaries, allowances (including benefits-in-kind), gratuities, superannuation and any other income derived solely by reason of employment.
Question 12   What are non taxable deductions under PIT Act?
Answer           The sixth schedule of PITA as amended specifies the following as tax exempt. They are:
                        a) National Housing Fund contributions
                        b) National Health Insurance Scheme contributions
                        c) Life Assurance Premium
                        d) National Pension Scheme
                        e) Gratuities
Question13    Is it within the law for a state tax authority to charge interest, penalty and threaten distrainment for a shortfall between the PAYE remitted by a company and the expectation on the company`s tax deduction cards, going by the fact that actual tax could differ from expectations as a result of salary cuts and staff exits?
Answer           It is lawful for a state tax authority to carry out audit of your returns to ascertain compliance. It is also lawful for penalty to be charged on any shortfall. It should be noted however that there must be reconciliation meeting by both parties where all issues must be discussed and agreed. Where a taxpayer is still not pleased with the decision reached, the taxpayer has the powers as conferred by the PITA (as amended) to appeal to the Tax Appeal Tribunal.
Question 14   What is the tax implication of giving new/used vehicles to staff for use in an organization?
Answer           This is treated as benefit – in – kind. 5% of the value of the vehicle is calculated and added back to the income of staff and taxed.

Question 15   What is the current Relief claimable under Personal Income Tax Act?
Answer           The Personal Income Tax Act (PITA) as amended provides for Consolidated Relief Allowance (CRA) of N200,000.00 subject to a minimum of 1% of gross income whichever is higher plus 20% of gross income and the balance shall be taxable in accordance with the tax rates in schedule six (6) of the Act and as in Question four (4) of this section.
                          SECTION C: VALUE ADDED TAX (VAT)
Question 1     What are VATable goods?
Answer     All goods manufactured/assembled in or imported into Nigeria, except those specifically exempted under the law. Examples of VATable goods include jewelries, shoes, bags, television etc.
Question 2     What are VATable Services?
Answer           All services rendered by any person in Nigeria except those specifically exempted under the law.  Examples of VATable services are, services rendered by Lawyers, Engineers, Accountants, Contractors and Consultants etc.
Question 3     What are exempted goods under Value Added Tax (VAT) Act?
Answer:         Exempted goods are those goods which are not subject to VAT.
                        These include:
·         All medical and pharmaceutical products;
·         Basic food items;
·         Books and Educational materials;
·         Baby products;
·         Fertilizer (locally produced), agricultural and veterinary medicine, farming machinery and farming transportation equipment;
·         Plant and Machinery imported for use in the Export Processing Zone or Free Trade Zone; provided that 100% production of such company is for export
·         All commercial Aircraft and Aircraft spare parts imported for use in Nigeria
·         Amorphous Pet Chips (H S Code 3907.6000.00)
Question 4     What are exempted services under VAT Act?
Answer           Exempted services are services that are not VATable, i.e. not subject to 5% VAT. These include:
–          Medical services
–          Services  rendered by Community Banks,
–          People’s Banks and Mortgage Institutions,
–          Plays and performance conducted by the educational institutions as part of learning.
–          All exported services
Question 5     What is Zero-rated VAT?
Answer           Zero-rated VAT means whereas the goods and services are VATable, the applicable rate is zero percent (0%).
Question 6     Which transactions are zero-rated?
Answer           The following transactions are zero-rated. There are:-
i.      Non-oil exports
ii.     Goods and Services purchased by Diplomats
iii.    Goods and Services purchased by humanitarian donor-funded projects
 Question 7     What is the due date of filing VAT Returns?
Answer           The due date for filing VAT is 21st day of every month following month of transaction
Question 8     When a contractor/supplier supplies goods that are exempted from VAT, should VAT be paid?
Answer           Goods exempted from VAT are not VATable.
Question 9     Are entertainment services VATable?
Answer           Yes.  They are VATable services except as contained in the exempted services list.
Question 10   Are catering services VATable?
Answer           Yes. Catering services are VATable.
Question 11   Can Ministries, Departments, Agencies (MDAs) exempt foreign investors from paying VAT?
Answer           No. Ministries do not have statutory power to exempt a taxpayer from payment of tax or to amend the tax laws.
Question 12   Who is a VATable Person?
Answer           A VATable person under Value Added Tax Act (VATA) Cap VI LFN 2004 is “a person (other than a Public Authority acting in that capacity) who independently carries out in any place an economic activity as a producer, wholesaler, trader, supplier of services (including mining, and other related activities) or person exploiting tangible or intangible property for the purpose of obtaining income by way of trade or business”.
In other words, a VATable person is one who trade in VATable goods and services for a consideration.
Question 13   Is it compulsory for a VATable person to register for VAT?
Answer           Every VATable person has an obligation to register for VAT payment.
Question 14   Who is a VAT Agent?
Answer           VAT AGENT: – Are agents of Revenue Collection with regards to Value Added Tax.  They facilitate the deduction and remittance of VAT to the Revenue Office e.g. Ministries/Government Agencies/Parastatals and Oil companies
Question 15   Is VAT registration for individuals or corporate bodies?
Answer           It is for all so long as they are trading on goods and services as defined by law.
Question 16   What are the penalties for non – registration of VAT?
Answer           Failure or refusal to register with the Board within the specified time. The taxpayer shall be liable to a penalty of N10,000 for the first month in which the failure occurs and N5,000 for each subsequent month in which the failure continues.  If this persists, the premises where the business is carried on shall be sealed up.
Question 17   What are the penalties for non – deduction of VAT?
Answer           Non deduction or failure to collect tax by a taxable person attracts a penalty of 150% of the uncollected tax plus 5% interest above the CBN’s discount rate.
Question 18   What are the penalties for non – remittance of VAT?
Answer           Failure to remit tax shall attract a penalty of a sum equal to 5% per annum plus interest at a commercial rate payable within 30 days of notification by the Tax Authority.
Question 19   Why is VAT on certain goods and services paid in foreign currency?
Answer           Taxes are to be paid in the currency of transaction.
Question 20   Should Ministries issue contractors with receipts for VAT payment in place of FIRS receipt?
Answer           No.  Receipt acknowledging payment is only issued by FIRS.
Question 21   Most times organizations make part payment to contractors.  When should VAT be deducted?
Answer           For any payment made, the corresponding VAT should be deducted and remitted.
Question 22   Does FIRS grant refund on VAT to non-citizen who are leaving the country?
Answer           Section 23 of FIRS Establishment Act allows for refunds. Goods consumed in the country for which VAT was paid is not refundable.
Question 23   How is VAT on goods sold treated?
Answer           VAT element on goods sold is deducted and remitted to the FIRS through any of the approved collecting bank on or before the 21st day of the month following the month of sales.
Question 24   What does “VAT Inclusive” mean?
Answer           VAT inclusive means that VAT is already included in the cost of transaction (i.e. goods and services contract). However, the term is being discouraged as it is always advised that VAT be isolated and not included as part of the total invoice value.
Question 25   Some contractors charge 10% for VAT. Is it allowable?
Answer           No.  The 10% charged on VAT is wrong.  The Correct rate is 5%.  The contractor should not assume 10% to mean 5% for VAT and 5% for WHT. The two should be treated separately. WHT is deduct from the contract sum and therefore paid by the contractor, while VAT is paid as an addition to the contract sum by the consumer of the goods/services.
Question 26   What is input VAT?
Answer:         Input VAT is VAT paid on raw materials or goods and services used for production purposes or goods for resale or goods imported directly for resale.
Question 27   What is output VAT?
Answer           Output VAT is VAT charged by taxable persons on goods and services supplied.  Where output VAT is more than the Input VAT, the difference is paid to FIRS, but where Input VAT is more than output VAT, the taxable person claims a refund.
Question 28   How can input/output VAT be resolved at the Ministry or Parastatal level?
Answer           The issue of input/output VAT cannot be resolved by Government Ministries/Departments/Agencies.  However, for further clarification FIRS should be consulted.
Question 29   Are the services of a motor mechanic VATable?
Answer           Services provided by mechanics are VATable.  Even the motor or vehicle spare parts used for the services are subject to VAT.
Question 30   Do Mortgage Institutions pay VAT?
Answer           VAT is exempted only on the primary duties of mortgage institutions.  Any other activity (e.g. contract execution) outside their primary banking function attracts VAT.
Question 31   What happens in the case of electricity consumption? Who deducts VAT and how?
Answer           VAT is charged on the consumer by PHCN or the electricity company and is collected also by the company who is expected to remit same to FIRS.
Question 32   Is VAT a multiple Taxation?
Answer           No. VAT is not a multiple taxation, but a multi-stage tax; it is a consumption tax
Question 33   When should a Taxable person register for VAT?
Answer           All companies/organizations that have been in existence before the VAT Act came into operation in 1993 were expected to register for VAT within six months from the date of commencement of the Act.  New companies that came into operation after the commencement of the Act are expected to register for VAT within six months of commencement of business.
Question 34   Should VAT be paid on commercial rent?
Answer           Yes. VAT at 5% should be paid by the tenant on rent paid for use of property for commercial purposes.

Question 35   Is VAT payable on Non-oil product export?
Answer           All exports are zero rated i.e. tax rate applicable is 0%.  This means that all input VAT incurred in the production process up to the point of export is refundable.
                          SECTION D: WITHHOLDING TAX (WHT)
Question 1    What is Withholding Tax (WHT)?
Answer           Withholding Tax is basically an advance payment of income tax which may be used to offset or reduce tax liabilities. Or an advance tax to be applied as tax credit to settle the income tax liability of the year of assessments to which the income that suffered the deduction relate. Withholding Tax is not a tax but a prepaid tax.
Question 2     What is the due date for remitting WHT returns?
Answer           The due date for remitting WHT returns is 21st day of every month following the month in which the deductions were made.
Question 3     What  is the Rate of Withholding Tax for Companies and individuals on transactions?
Answer           Rates of WHT for corporate companies and individuals on transactions are as follows:-
Royalties 10 5
Contract of Supplies 5 5
Contract of Construction 5 5
Dividend 10 10
Technical Service 10 5
Professional Service 10 5
Consultancy 10 5
Management Service 10 5
Commission 10 5
Rent 10 10
Interest 10 10
Hire, Charter, Lease 10 10
Directors fees 10 10
Question 4     What is the content of remittance schedule of Withholding Tax Returns?
Answer              i. Name and address of the Agent/Depositor.
              ii. TIN of the Agent/Depositor
             iii. The name and address of the Taxpayer/Beneficiary
                         iv. TIN of the Taxpayer/Beneficiary
                         v.  The nature of transaction
                         vi. The gross value of the business on which WHT is being deducted
                        vii. The applicable rate of WHT
                       viii. The amount of WHT deducted.
                         ix. Period covered
Question 5     What is Withholding Tax Credit Note?
Answer           This is the document issued by the Tax Authority showing that a taxpayer has suffered tax deduction at source.
Question 6     What are the contents of Withholding Tax Credit Note?
Answer            Withholding Tax Credit Note will generally include the following information:
·         Credit note Number.
·         The name of the agent/taxpayer who deducted and remitted the Withholding Tax.
·         The name of beneficiary from whose income WHT was deducted.
·         The nature of transaction.
·         The date of the transaction.
·         The name of the bank through which remittance was affected.
·         The amount deducted
·         The period covered
Question 7     Can WHT Credit note be used to offset late returns penalty (LRP)?
Answer           No, WHT Credit Note cannot be used to offset LRP. Penalty is not
                        Tax, WHT Credit Note can only be used to offset income tax due.
Question 8     Why does it take longer time to confirm WHT Credit Notes issued
                        by the same FIRS?
Answer           Confirmation of WHT Credit Notes took longer time because of the manual processes involved. Confirmation will now be done on-line with the coming of the FIRS web-portal
Question 9    Is mobilisation fee liable to WHT?
Answer        Yes, Mobilisation fee is liable to WHT. In addition, every Certificate of work done
issued at the different stages of a contract must be subjected to 5% WHT. However, the amount of WHT being deducted at source from the mobilisation fee paid at the inception of the contract should be adjusted (deducted) from the WHT due on the next payment in respect of the certificate of work done issued and the balance should be remitted to the relevant tax authority.
Question 10   Who are the agents of WHT?
Answer          The agents of WHT are;
i.                    Corporate bodies (companies)
ii.                  Individuals, firms and sole traders.
iii.                A statutory body, a public authority and other institutions or organisations.
iv.                Government Ministry, Department or Agency  and Local Government.
Question 11   Is there any exemption from Withholding Tax ?
Answer            Yes, there are certain transactions that are exempted from WHT,
                          such as;
i.              Direct purchase across the counter,
ii.             Direct purchase of raw materials from supplier as distinct from contract of supplies
iii.            Sale in the ordinary course of business.
iv.           All imported goods.
v.            Inter- bank interest.
vi.           Income exempted from income tax
vii.          Claims in insurance business
viii.         Interest on Bonds
ix.           Dividends redistributed by Holding Companies
Question 12   What are the relevant documents required for filing WHT Returns?
Answer           Relevant documents for filing WHT includes:
i          Evidence of payments to an authorised banks – e-ticket
ii.             Schedule of WHT deducted showing:
a.    Period covered
b.    Name of supplier
c.    Addresses
d.    Nature of supply
e.    Gross amount
f.     WHT rate
g.    WHT amount
h.    TIN of agent making remittance
i.      TIN of beneficiary (taxpayer).
For more information, contact the Federal Inland Revenue Service online at
  1. Maize
  2. Timber (rough or sawn)
  3. Raw hides and skin (including Wet Blue and all unfinished leather) H.S. Codes 4101.2000.00 – 4108.9200.00
  4. Scrap Metals
  5. Unprocessed rubber latex and rubber lumps
  6. Artifacts and Antiquities
  7. Wildlife animals classified as endangered species and their products e.g. Crocodile; Elephant, Lizard, Eagle, Monkey, Zebra, Lion etc.
  8. All goods imported

For more information, visit the Nigeria Custom Service Official Website at:

  1. Air Pistolsimport
  2. Airmail Photographic Printing Paper.
  3. All counterfeit/pirated materials or articles including Base or Counterfeit Coin of any Country.
  4. Beads composed of inflammable celluloid or other similar substances.
  5. Blank invoices.
  6. Coupons for Foreign Football pools or other betting arrangements.
  7. Cowries.
  8. Exhausted tea or tea mixed with other substances. For the purposes of this item, “exhausted tea” means any tea which has been deprived of its proper quality, strength, or virtue by steeping, infusion, decoction or other means.
  9. Implements appertaining to the reloading of cartridges.
  10. Indecent or obscene prints, painting, books, cards, engraving or any indecent or obscene articles.
  11. Manilas.
  12. Matches made with white phosphorous.
  13. Materials of any description with a design which, considering the purpose for which any such material is intended to be used, is likely in – the opinion of the president to create a breach of the peace or to offend the religious views of any class of persons in Nigeria.
  14. Meat, Vegetables or other provisions declared by a health officer to be unfit for human consumption.
  15. Piece goods and all other textiles including wearing apparel, hardware of all kinds’ crockery and china or earthenware goods bearing inscriptions (whether in Roman or Arabic characters) from the Koran or from the traditions and commentaries on the Koran.
  16. Pistols disguised in any form.
  17. Second-hand clothing.
  18. Silver or metal alloy coins not being legal tender in Nigeria.
  19. Nuclear Industrial waste and other Toxic waste
  20. Spirits: –
    • Other than –
    • Alcoholic bitters, liqueurs, cordials and mixtures admitted as such in his discretion by the Comptroller-General and which are not deemed to be injurious spirits within the meaning of any enactment or law relating to liquor or liquor licensing.
    • Brandy, i.e. a Spirit Distilled in Grape-growing countries from fermented grape juice and from no other materials and Stored in wood for a period of three years;
    • Drugs and medicinal spirits admitted as such in his discretion by the Comptroller-General.
    • Gin, i.e. Spirit- Produced by distillation from a mixed mash of cereal grains only saccharified by the diastase of malt and the Flavoured by redistillation with juniper berries and other vegetable ingredients and of a brand which has been notified as an approved brand by notice in the Gazette and in containers labeled with the name and address of the owner of the brand; or
    • Produced by distillation at least three times in a pot-still from mixed mash or barley, rye and maize saccharified by diastase of malt – and then rectified by re-distillation in a potstill after the addition of juniper berries and other vegetable materials.
    • Methylated or denatured spirit, i.e. – Mineralized Methylated spirit mixed as follows: – To every ninety parts by volume of spirits nine and one-half parts by volume of wood naphtha and one-half of one part by volume of crude pyridine and to every 455 litres of the mixture 1.7 litres of mineral naphtha or petroleum oil and not less than 0.7 grammes by weight of powdered aniline dye (Methyl violet) and so in proportion for any quantity less than 455 litres; and
    • Industrial Methylated spirit imported under license from the Comptroller-General and mixed as follows: – To every ninety-five parts by volume of spirits five parts by volume of wood naphtha and also one-half of one part by volume of the mixture; and
    • Spirits denatured for a particular purpose in such manner as the Comptroller-General in any special circumstance may permit;
    • Perfumed Spirits
    • Rum i.e. a Spirit – Distilled direct from sugar-cane products in sugar-cane growing countries; and
    • Stored in wood for a period of three years.
    • Spirits imported for medical or scientific purposes, subject to such conditions as the Comptroller-General may prescribe;
    • Spirits totally unfit for use as portable spirits admitted to entry as such in the discretion by the Comptroller-General; and
    • Whisky, i.e. a Spirit- Obtained by distillation from a mash or cereal grains saccharified by diastase of malt; and
    • Stored in wood for a period of three years.
    • Containing more than forty-eight and one-half per centum of pure alcohol by volume except denatured, medicated and perfumed spirits, and such other spirits which the Comptroller-General, in his discretion, may allow to be imported subject to such conditions as he may see fit to Impose.
    • Weapons of any description which in the opinion of the Comptroller-General are designed for the discharge of any noxious liquid, gas or other similar substance and any ammunition containing or in the opinion of the Comptroller- General or adapted to contain any noxious liquid, gas or other similar substances

For more information, visit the Nigeria Custom Service Official Website at:

  1. Live or Dead Birds including Frozen Poultry – H.S. Codes 0105.1100 – 0105.9900, 0106.3100 – 0106.3900, 0207.1100 –Nigeria Import Prohibition List 0207.3600 and 0210.9900
  2. Pork, Beef – H.S. Codes 0201.1000 – 0204.5000, 0206.1000 – 0206.9000, 0210.1000 – 0210.2000.
  3. Birds Eggs – H.S. Code 0407.0000.
  4. Refined Vegetable Oils and Fats – H.S. Code 1507.1000 – 1516.2000.29 [but excluding Linseed, Castor and Olive oils. Crude vegetable oil are however NOT banned from importation].
  5. Cocoa Butter, Powder and Cakes – H.S. Codes 1802. – 1803.2000, 1805.0000, 1806.1000 – 1806.2000 and 1804.0000.
  6. Spaghetti/Noodles – H.S. Codes 1902.1100 – 1902.3000.
  7. Fruit Juice in Retail Packs – H.S. Codes 2009.110012 – 2009.110013 – 2009.9000.99
  8. Waters, including Mineral Waters and Aerated Waters containing added Sugar or Sweetening Matter or Flavoured, ice snow – H.S. Codes 2202.1000 – 2202.9000, other non-alcoholic beverages H.S. Code 2202.1000 – 2202.9000.99 [ but excluding energy or Health Drinks {Liquid Dietary Supplements} e.g. Power Horse, Red Ginseng etc] H.S. Code 2202.9000.91 and Beer and Stout (Bottled, Canned or Otherwise packed) H.S. Code 2203.0010.00 – 2203.0090.00
  9. Bagged Cement – H.S. Code 2523.2900.22.
  10. Medicaments falling under Headings 3003 and 3004 as indicated below:
    • Paracetamol Tablets and Syrups
    • Cotrimoxazole Tablets Syrups
    • Metronidazole Tablets and Syrups
    • Chloroquine Tablets and Syrups
    • Haematinic Formulations; Ferrous Sulphate and Ferrous Gluconate Tablets, Folic Acid Tablets, Vitamine B Complex Tablet [except modified released formulations].
    • Multivitamin Tablets, capsules and Syrups [except special formulations].
    • Aspirin Tablets [except modified released formulation and soluble aspirin].
    • Magnesium trisilicate tablets and suspensions.
    • Piperazine tablets and Syrups
    • Levamisole Tablets and Syrups
    • Clotrimazole Cream
    • Ointments – Penecilin/Gentamycin
    • Pyrantel Pamoate tablets and Syrups
    • Intravenous Fluids [Dextrose, Normal Saline, etc.]
  11. Waste Pharmaceuticals – H.S. Code 3006.9200
  12. Soaps and Detergents – H.S. Code 3401.1100 – 3402.9000 in retail packs
  13. Mosquito Repellant Coils – H.S. Code 3808.9110.91.
  14. Sanitary Wares of Plastics – H.S. Code 3922.1000 – 3922.9000 and Domestic Articles and Wares of Plastics H.S. Code 3924.1000 – 3924.9000.00 [but excluding Baby Feeding bottles 3924.9020.00] and flushing ceinstern and waterless toos toilets.
  15. Rethreaded and used Pneumatic tyres but excluding used trucks tyres for rethreading of sized 11.00 x 20 and above 4012.2010.00.
  16. Corrugated Paper and Paper Boards – H.S. Code 4808.1000, and cartons, boxes and cases made from corrugated paper and paper boards H.S. Code 4819.1000, Toilet paper, Cleaning or facial tissue – H.S. Code 4818.1000 – 4818.9000 excluding baby diapers and incotinent pads for adult use 4818.4000.41 and Exercise Books – H.S. Code 4820.2000.
  17. Telephone Re-charge Cards and Vouchers – H.S. Code 4911.9900.91
  18. Textile Fabrics of all types and articles thereof and Yarn falling under the following H.S. Codes remain under import prohibition;
    • African print [Printed Fabrics] e.g. Nigeria wax, Hollandaise, English Wax, Ankara and similar Fabrics under the following H.S. Codes – 5208.5110 – 5208.5900, 5209.5100 – 5209.5900, 5212.5100, 5212.5100, 5212.2500, 5407.4400, 5407.5400, 5407.7400, 5407.8400, 5407.9400, 5408.2400, 5408.3400, 5513.4100 – 5513.4900, 5514.4100 – 5514.4900, 5516.1400, 5516.2400, 5516.3400, and 5514.4900.00
    • Carpets and Rugs of all types falling under H.S. Codes 5701.1000 – 5705.0000.
    • But excluding the Following:
    • Lace Fabrics, Georges and other embroided Fabrics falling under H.S. Codes 5801.2100 – 5801.9000, 5802.1100 – 5802.3000 and 5805.0000.00
    • Made-up Garments and other Textile articles falling under H.S. Codes 6101.2000 – 6310.9000.99
  19. All types of Foot Wears and Bags including Suitcases of leather and plastics H.S. Codes 6401.1000.11 – 6405.9000.99 and 4202.1100.10 – 4202.9900.99 [but excluding Safety Shoes used in oil industries, Hospitals, Fire fighting and Factories, Sports Shoes, canvass shoes all Completely Knocked Down (CKD) blanks and parts]
  20. Hollow Glass Bottles of a capacity exceeding 150mls (0.15 litres) of a kind used for packaging of beverages by breweries and other beverage and drink companies – H.S. Code 7010.9021.29 and 7010.9031.00.
  21. Used Compressors – H.S. Code 8414.3000, Used Air Conditioners – H.S. Codes 8415.1000.11 – 8415.9000.99 and Used Fridges/Freezers – H.S. Codes 8418.1000.11 – 8418.6900.
  22. Used Motor Vehicles above fifteen (15) years from the year of manufacture – H.S. Codes 8703.1000 – 8703.9000
  23. Furniture – H.S. Codes 9401.1000.00 – 9401.9000.99 and 9403.1000 – 9404.9000, but excluding Baby walkers, laboratory cabinets such as microscope table, fume cupboards, laboratory benches (9403), Stadium Chairs, height adjustments device, base sledge, seat frames and control mechanism, arm guide and headguides. Also excluded are; skeletal parts of furniture such as blanks, unholstered or unfinished part of metal, plastics, veneer, chair shell etc. Also excluded are Motor Vehicle seats (9401.2000.00) and Seats other than garden seats or camping equipment, convertible into beds (9401.4000.00)
  24. Ball Point Pens – H.S. Code 9608.1000

Goods: Shedule 4 The Importation of which is Absolutely Prohibited

For more information, visit the Nigerian Custom Service official website

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All business enterprises must be registered with the Corporate Affairs Commission. Business activities may be undertaken in Nigeria as a:

  1. Private Limited Liability Company;
  2. Public Limited Liability Company (Plc);
  3. Unlimited Liability Company;
  4. Company Limited by Guarantee;
  5. Foreign Company (branch or subsidiary of foreign company);
  6. Partnership/Firm;
  7. Sole Proprietorship;
  8. Incorporated trustees (religious, charitable, philanthropic or cultural);
  9. Representative office in special cases.


The Companies and Allied Matters Act, 1990 (the Companies Act) is the principal law regulating the incorporation of businesses. The administration of the Companies Act is undertaken by the CORPORATE AFFAIRS COMMISSION (CAC), which undertakes the administration of the Companies Act.

Minimum Share Capital
The minimum authorised share capital is N10, 000 (Ten Thousand Naira) in the case of private companies or N500,000 (Five Hundred Thousand Naira) in the case of public companies with a minimum subscription of 25% of the authorised share capital respectively.


A non-Nigerian may invest and participate in the operation of any enterprise in Nigeria. However, a foreign company wishing to business-incorporation-in-nigeriaset up business operations in Nigeria should take all steps necessary to obtain local incorporation of the Nigerian branch or subsidiary as a separate entity in Nigeria for that purpose. Until so incorporated, the foreign company may not carry on business in Nigeria or exercise any of the powers of a registered company.
The foreign investor may incorporate a Nigerian branch or subsidiary by giving a power of attorney to a qualified solicitor in Nigeria for this purpose. The incorporation documents in this instance would disclose that the solicitor is merely acting as an “agent” of a “principal” whose name(s) should also appear in the document. The power of attorney should be designed to lapse and the appointed solicitor ceases to function upon the conclusion of all registration formalities.

The locally incorporated branch or subsidiary company must then register with the Nigerian Investment Promotion Commission (NIPC) before commencing formal operations. The new company may also apply to NIPC for other investment approvals (e.g. expatriate quota) and other incentives.

Exemption to the General Rule
Where exemption from local incorporation is desired, a foreign company may apply in accordance with Section 56 of the Companies Act, to the National Council of Ministers for exemption from incorporating a local subsidiary if such foreign company belongs to one of the following categories:

  1. “foreign companies invited to Nigeria by or with the approval of the Federal Government of Nigeria to execute any specified individual project;
  2. foreign companies which are in Nigeria for the execution of a specific individual loan project on behalf of a donor country or international organisation;
  3. foreign government-owned companies engaged solely in export promotion activities; and
  4. engineering consultants and technical experts engaged on any individual specialist project under contract with any of the governments in the Federation or any of their agencies or with any other body or person, where such contract has been approved by the Federal Government.”

The application for exemption from disclosing certain details about the applicant is to be made to the Secretary to the Government of the Federation (SGF). If successful, the request of the applicant is granted upon such terms and conditions, as the National Council of Ministers may think fit.

Representative Offices
Foreign companies may set up representative offices in Nigeria. A representative office however, cannot engage in business or conclude contracts or open or negotiate any letters of credit. It can only serve as a promotional and liaison office, and its local operational expenses have to be floated by the foreign company. A representative office has to be registered with the CAC.

Is there a limit to foreign participation in an enterprise in Nigeria?

Foreigners may own up to 100% of any Nigerian business (S17) except in the Maritime sector (Cabotage).

What is the procedure for repatriation of capital and profit?
Under the provisions of the Foreign Exchange (Monitoring & Miscellaneous Provision Act No. 17 of 1995) , foreign investors are free to repatriate their profits and dividends net of taxes through an authorized dealer in freely convertible currency.

What are the types of Companies Registered in Nigeria?

  • Private Companies Limited by Shares
  • Public Companies Limited by Shares
  • Companies Limited by Guarantee
  • Unlimited Companies
  • Exemptions are granted to foreign Companies undertaking special project. Companies seeking exemption are to forward their application to the Secretary to the Federal Government of Nigeria.

What are the requirements for the Incorporation of a Company in Nigeria?

  •  Search for availability of name
  • Payment of appropriate stamp duty fee at the Federal Board of Internal Revenue
  • Submission of Memorandum and Articles of Association together with statutory forms for verification and assessment
  • Payment of statutory fees at Corporate Affairs Commission

For further details visit the Corporate Affairs Commission (CAC). Website at or contact them at:

The Customer Service Unit,
Corporate Affairs Commission,
Plot 565 Ndola Square,
Off Micheal Okpara Street,
Wuse Zone 5, Abuja, Nigeria.


What are the requirements for Business Permit?

  1. Formal application letter to Executive Secretary
  2. Minimum Share Capital Requirement – N10million
  3. Duly completed NIPC Form I
  4. Certificate of Incorporation
  5. CAC’s Forms C02 and C07
  6. Memorandum and Articles of Association
  7. Tax Clearance Certificate
  8. Certificate of Capital Importation
  9. Evidence of acquisition of Business Premises (Tenancy or Lease Agreement)
  10. Feasibility Report

NIPC Form I – N50, 000 (Fifty Thousand Naira)
Collection of Business Permit Certificate – N50, 000 (Fifty Thousand Naira)

 What are the requirements for Expatriate Quota?
In addition to the requirements listed under Business Permit, the following are also required:

  1. Evidence of Acquisition of Operational Premises and Operational Machinery Equipment in the case of Industrial Establishment
  2. Evidence of foreign Capital Importation
  3. Management and Technical Service Agreement (for service Companies)
  4. Tax Clearance
  5. Minimum Authorized Share Capital of Ten Million Naira (N10,000,000)
  6. The Company must produce its project implementation programme
  7. The Company must produce a training programme for Nigerians in addition to management success schedule


What approvals/licenses would an investor require to set up an enterprise?
Approvals/licenses are given by the following Agencies depending on the sector to be invested in:

 Oil & Gas Sector
1. Department of Petroleum Resources (DPR) – Oil & Gas
Plot 622, Eket Close
Area 8, Garki,
P.M.B. 399
Tel: 234-9-2349982, 2349988

 Food & Drug Manufacture
2. National Agency for Food and Drug Administration and Control (NAFDAC) – Food and Drug Manufacturing
Moshod Abiola Road, Area 2
P.M.B. 5023 Garki, Abuja
Tel: 234-9-2346383, 2346405, 2346402



3. Standards Organisation of Nigeria (SON) – All Manufacturing Sectors
13/14, Victoria Arobieke Street
Off Admiral Way
Northern Business District
Lekki Peninsula, Lagos
Tel: 234-9-2708231-4

4. Nigerian Communication Commission – Telecommunication
Plot 423, Aguiyi Ironsi Street
Maitama, Abuja,
Federal Capital Territory.
Tel: +234-9-4617000, Fax: +234-9-4617514

5.Federal Ministry of Agriculture – Agriculture
FCT Secretariat, Area 11
Garki, Abuja
Telephone: 234-9-2341931, 2342331, 2341458

 Environmental Impact Assessment Certification (for all Industries)
6. Ministry of Environment – Manufacturing
Federal Secretariat Complex
(7&9 Floor)
Shehu Shagari Way, Maitama
P.M.B. 468, Garki, Abuja
Tel: 234-9-523431, 5234932, 5234932

7. National Tourism Development corporation
Old Federal Secretariat, Area 1
P.M.B 167 – Garki
Tel: 234- 2764,
Fax: 2342775

 Solid Minerals
8. Ministry of Solid Minerals Development
Federal Secretariat Complex,
Shehu Shagari Way, Maitama
P.M.B 107, Garki Abuja
Tel: 234-9-5235830, 5236517

Power & Steel
9. Ministry of Power and Steel
Federal Secretariat Complex,
Shehu Shagari Way, Maitama
P.M.B. 278, Garki, Abuja
Tel: 234-5237064-6

 What is the Companies Income Tax Rate in Nigeria?

 Which areas (sectors) are closed to investment in Nigeria?
Investors are prohibited from participating in the following business activities: Businesses involved in production of military or paramilitary attire and equipment; or production of narcotic drugs and psychotropic substances (S8).

 What are the incentives available for investing in Nigeria?
There are both general sector specific and incentives. The general incentives include the following:

a. Pioneer Status:
Pioneer status takes the form of five-year tax holiday to qualifying industries anywhere in the federation.

The grant of pioneer status to an industry is aimed at enabling the industry concerned to make a reasonable level of profit within its formative years. The profit so made is expected to be plugged back to facilitate expansion and growth of the industry.

 Requirements for Pioneer Status?

Pioneer Status is conferred on a firm if it falls within the sectors that are defined by the government as priority areas. When a project is conferred with pioneer status, it becomes entitled to a tax holiday of 5 years.

  1.  Formal application letter to Executive Secretary
  2. Minimum Share Capital Requirement – N10million
  3. Duly completed NIPC Form II
  4. Certificate of Incorporation
  5. CAC’s Forms C02 and C07
  6. Memorandum and Articles of Association
  7. Tax Clearance Certificate
  8. Evidence of acquisition of machinery; (Form M)
  9. Evidence of acquisition of Business Premises (Tenancy or Lease
  10. Agreement)
  11. Feasibility Report
  12. Fees
    i.NIPC Form II – N40, 000
    ii.Processing Fees – N100, 000
    iii.Collection of Approval letter – N60, 000
    iv.Application for Extension – free
    v.Approval of Pioneer Status Extension – N50, 000

b. Capital Allowances
The amount of capital allowance to be enjoyed in any year of assessment is restricted in Nigeria to a percentage of assessable profit. The following is a schedule for the sectors:

Tax Allowance Initial % Annual %
Building Expenditure 15 Nil
Industrial Building


15 Nil
Mining 95 Nil

i. (Agric prod)

ii. Others





Furniture fittings 25 20
Motor Vehicles

i. Public Transportation

ii. Others






Housing Estate 50 25
Ranching/Plantation 30 50
R & D 95 Nil





Allowanc 10%


What are the Incentives in the Oil and Gas Sector?

In view of the enormous potentials in this sector, some fiscal incentives have been put in place by the government for investors as follows:

Gas Production Phase

  • Applicable tax rate under the Petroleum Profit Tax (PPT) Act to be at the same rate as company tax currently at 30%.
  • Capital Allowance at the rate of 20% per annum in the first four years, 19% in the fifth year and the remaining 1% in the books.
  • Investment Tax Credit of the current rate of 5%.
  • Royalty at the rate of 7% on shore and 5% offshore.


Gas Transmission and Distribution

  • Capital allowance as in production phase above.
  • Tax rate as in production phase.
  • Tax holiday under pioneering status.

LNG Projects

  • Applicable tax rate under PPT is 45%.
  • Capital allowance is 33% per year on straight-line basis in the first three years with 1% remaining in the books.
  • Investment tax credit of 10%.
  • Royalty of 7% on-shore, 5% off-shore tax deductible


Gas Exploitation (Upstream Operations)

Fiscal Arrangements are reviewed as follows:

  • All investment necessary to separate oil from gas from the reserves into suitable products is considered part of the oil field development.
  • Capital investment facilities to deliver Associated Gas in usable form at utilization or transfer points will be treated for fiscal purposes as part of the capital investment for oil development.
  • Capital allowances, operating expenses and basis for assessment will be subjected to the provisions of the PPT Act and the revised Memorandum of Understanding (MOU).


Gas Utilisation (Downstream Operations)

Incentives given to investors for encouragement of exploitation and utilization of Associated Gas for commercial purposes include:

  • Companies engaged in gas utilization are to be subjected to the provisions of the Companies Income Tax Act (CITA).
  • An initial tax free period of five years.
  • Accelerated Capital Allowance after the tax-free period in the form of 90% with 10% retention in the books for plant and machinery.
  • 15% investment capital allowance which shall not reduce the value of the asset.

In 1998, the government approved additional incentives to support the gas industry in the following areas:

  •  All fiscal incentives under the gas utilization downstream operations in 1997 are to be extended to industrial projects that use gas i.e. power plants, gas to liquids plants, fertilizer plants and gas distribution/transmission plants.
  • Gas is transferred at 0% PPT and 0% Royalty.
  • Interest on loans for gas projects is to be tax deductible provided that prior approval was obtained from the Federal Ministry of Finance before taking the loan.
  • All dividends distributed during the tax holiday shall not be taxed.


What are the incentives in the Power Sector?

The Federal Government of Nigeria has set-up several incentives to attract foreign direct investment into the power sector. The incentives include:

  • Tax Holidays of up to 5 years
  • Exemption from Duty Taxes on imported equipment
  • Capital & Investment Allowance which can be carried forward and used after tax holiday period
  • Manufacture of transformers, meters, control panels, switchgears, cables and other electrical related equipment are considered as pioneer products/industries. As a result, there is tax holiday of 5 to 7 years for investors who invest in these areas.
  • Power plants using gas are assessed under the companies income tax act at a reduced rate of 30%
  • 100% foreign ownership of Electricity plants
  • · Repatriation of profit with a 5% withholding tax
  • · Instituting a politically independent, and transparent regulatory agent for the power sector that will effectively enforce the established regulatory framework
  • · Putting in place the necessary foundations e.g. reliable transmission infrastructure that would create a level playing field for efficient private sector participation in the electricity supply
  • · Implementing a transparent and predicated tariff adjustment mechanism that will cover cost of production and provide adequate returns on investment at all times.

What are the incentives in the Agriculture sector?

The government within the past few years has introduced a number of measures designed to promote investment. Some of these measures include:

  1.  Fiscal measures on taxation
  2. Effective protection of local industries with import tariff or outright ban on importation of locally available substitutes;
  3. Export promotion of Nigerian-made products; and
  4. Foreign currency facility for international trade.

Some of the specific incentives are categorized as follows:

i. Export Incentives: Retention of export proceeds in foreign currency:

Exporters of Nigerian commodities are obliged to open a foreign currency domiciliary account (D/A) with an authorized bank of its choice in which 100% of the proceeds of such exports may be credited in foreign currency.

ii. Export Development Fund (EDF)

The Export Development Fund (EDF) is a special fund set up by the government to provide financial assistance to private sector exporting companies to off-set part of their initial expenses in respect of certain export promotion activities. These are promotional activities and the conditions for eligibility are as outlined by the Nigerian Export Promotion Council (NEPC).


iii. Export Adjustment Fund Scheme:

This scheme serves as supplementary export subsidy to compensate exporters for the high cost of local production arising mainly from infrastruactural deficiencies and also other natural and negative factors beyond the control of the exporter.


iv. Tax and Other Incentives:

  •  Export oriented industries:
    Export oriented industries that export not less than 60% of their product can enjoy 10 percent tax concession for five years.
  • Excise duty:
    In order to boost local industries, stimulate trade and reduce cost, government abolished most excise duties since 1st January 1998.
  •  Capital Assets Depreciation Allowance:
    The Law in Nigeria provides an additional annual depreciation allowance of 50% on plant and machinery to manufacturing exporters who exports at least 50% of the value of their annual turnover provided that the product has at least 40% local raw materials content or 35% value added.
  •  Pioneer Status:
    The provision of the Industrial Development (Income Tax Relief) Act with respect to Pioneer Status tax holidays applied to any manufacturing exporter who exports at least 50% of his annual turnover.
  •  Companies with small or no profits in Agro allied business are exempted from paying minimum tax of 20%


What are the Incentives in the Telecommunications Sector?

  • Good tariff structure, which ensures that investors recover their investment over a reasonable period of time.
  • Import duty on all telecoms equipment reduced from 25% to 5%.
  • Measures on speedy clearance of goods at the ports
  • Exclusivity period for licences, e.g. 5 years for the GSM licences, 3 years for long distance international gateway operators.
  • Pioneer status for five years (under industrial Development (Income Tax Relief) Act 1990) is offered to interested investors who want to set plants for the manufacture of telecoms equipment in the country


What are the Incentives in the Solid Minerals Sector?

In order to encourage investments in the sector Government has put in place the following incentives;

  •  Three to five years tax holiday for new mining companies, and a system of deferred royalty payment that is determined by the level of the investment and the strategic nature of the project. Also possible is capitalization of expenditure on exploration and surveys;
  • Companies profits tax reduction from 30% to 20%;
  • Roll-over relief from Capital Gains Tax.
  • Capital Allowance of 95% for Mining companies replacing their Plant and Equipment and 75% for companies with Mining Lease.
  • Extension of infrastructure such as roads and electricity to mining sites;
  • Provision of 100% foreign ownership of mining companies or concerns;
  • Tax Relief on Interest Income: Interest accruing from loans granted by banks in aid of export activities enjoys favourable tax treatment.
  • Capital Assets Depreciation Allowance: The law in Nigeria provides an additional annual depreciation allowance of 5% on plants and machinery to manufacturing exporters who export at least 50% of their annual turnover provided that the product has at least 40% local raw material content or 35% value added;


What are the incentives in the Free Trade Zones

Locating in any Free Trade zone in Nigeria automatically confers on the investor, certain locational advantages as well as very generous incentives. These include:

  •  Relative proximity to major markets of Africa, Europe and America.
  • Large domestic market for the 25% of production that FTZ producers can sell in the Customs Territory.
  • Favourable quotas on certain products from Nigeria export to the European Union (EU) and the United States.
  • Made in Nigeria products enjoy preferential tariffs concessions in EU.
  • Abundant supply of skilled labour at very competitive rates;

In addition to the above, the Nigeria EPZ’s regulatory regime is liberal and provides a conducive environment for profitable operations. The incentives available are among the most attractive in Africa and compares favourably with those in other parts of the world. These include:

a. Exemption from all Federal, State and Local Government taxes, levies and rates

b. Approved enterprises shall be entitled to import into a Zone, free of customs duty on capital goods, consumer goods, raw materials, components and articles intended to be used for purposes of and in connection with an approved activity.

c. Freedom from legislative provision pertaining to taxes, levies. Duties and foreign exchange regulations.

d. Repatriation of foreign capital on investment in the zone at any time with capital appreciation of the investment.

e. 100% foreign or local ownership of factory allowable

f. One stop approvals, (factory management deals with only the management of the zone) which grant all licenses whether or not the business is incorporated in the Customs territory

g. Unrestricted remittance of profits earned by investors

h. Permission to sell 100% of total production in the domestic market

i. No import or export license

j. Rent free land at construction stage, thereafter rent shall be as determined by the management of the zone. Foreign manager and qualified personnel may be employed by companies operating in the Zones

k. Operations within a zone shall commence on the date when the constructions of the perimeter fence and gate have been completed and the Authority has declared it so.


Where else could one get information about Nigeria Nigeria’s economic data?

Nigeria has an embassy or High Commission in most countries of the world. Please visit the Nigerian Embassy or High Commission in your country. For online information on Nigeria’s economic data, please, or www.


What other Agencies are involved in the investment process in Nigeria?

The foremost investment Agency in Nigeria is the Nigerian Investment Promotion Commission (NIPC). The Commission however collaborates with other agencies to facilitate investment in Nigeria. Among these are:

  • Corporate Affairs Commission

565 Ndola Sq off Micheal Okpara Street
Wuse, Zone 5
P. M. B. 198
Tel: 234-9-5241016, 5241046-50
Fax: 234-9-521017


  • Nigerian Export Promotion Council

Block 312, Kumba Street,
P.M.B. 133
Tel: 234-9-5230980, 5230932, 5230933, 5230981
Fax: 234-9-2340931


  • Nigerian Export Processing Zones Authority

Shehu Shagari Way
Tel: 234-9-234060, 2343062
Fax: 234-9-2343061, 2343063


  • Federal Ministry of Foreign Affairs

Maputo Street, Wuse Zone 3
P.M.B.130, Garki, Abuja
Tel: 234-9-523049, 5230185-6, 5230490

  •   Federal Ministry of Commerce

Old Federal Secretariat Complex
Area 1, P.M.B. 88
Garki, Abuja
Tel: 234-9-2341687, 2341687, 2341490, 2348454, 2341484


  • Federal Ministry of Internal Affairs

Old Federal Secretariat Complex,
Area 1, P.M.B. 7007,
Garki, Abuja
Tel: 234-9-2341934-5, 2342426


  • Federal Ministry of Finance

Federal Ministry of Finance Building,
Ahmadu Bello Way, Central Business District
P. M. B. 14, GArki, Abuja
Tel: 234-9-2346932, 2346928, 2346286, 2346289


  • Federal Ministry of Industry
    Old Federal Secretariat, Area 1
    P.M.B. 85Garki, Abuja
    Tel: 234-9-2341690


  • National Tourism Development Corporation

Old Federal Secretariat, Area 1
Garki, Abuja

Which is the Agency responsible for privatization in Nigeria?

The Agency which is the secretariat for the National Council on Privatisation is located at

No.1, Osun Crescent, Off IBB Way
Maitama, Abuja
Tel: 234-9-5235256



In September 1999, the Federal Republic of Nigeria re-introduced the pre- shipment programme for inspection of imports.

Swede Control/ Intertek (SCI) is one of four Pre-shipment inspection companies chosen to participate in the program. The territories apportioned to SCI are shown in Appendix A.

These guidelines summarise the changes and their impact upon Exporters.

Should you have any queries, please kindly contact your nearest SCI office where trained SCI personnel will be happy to assist.

You will find our offices addresses, telephones and fax numbers, throughout the world, in Appendix C.

All Forms ‘M’ raised on or after September 1st 1999 are subject to pre- shipment inspection.


PSI – Pre- shipment Inspection

LO – Liaison Office

(SCI’s main office in Nigeria)

IO – Issuing Office

(SCI’s office in the Exporter’s country, which will organise PSI for your goods and issue a certificate for their clearance through Customs by the Importer as well as issue a Certified Invoice to the Exporter for negotiation of a Letter of Credit.)

RFI – Request for information

A notification sent to the Exporter by SCI in respect of each individual Form ‘M’ and proforma(Each file will have a unique reference number allocated, known as the RFI number. This number should be quoted in all correspondence with SCI).

CRI – Clean Report of Inspection

The document issued by SCI which provides the SCI assessment of value and coding. The CRI is required by the Importer to obtain Customs Clearance.

DRI – Discrepancy Report of Inspection

The document issued by SCI when goods fail to pass PSI, either because discrepancies are not corrected by the Exporter or because the Exporter fails to provide SCI with a clean set of final documentsThis document prohibits clearance of goods in Nigeria.

L/C – Letter of Credit


Upon receipt of the Form M and supporting documents (including the letter of credit, if applicable) from the Importer, the Authorised Dealer Bank will process and deliver it to the SCI office in Lagos, who will analyse them and load them into the system. For your information, the Form M is available from regional SCI offices overseas as well as Nigerian Embassies, Authorised Dealer Banks etc…

Should there be no reason to reject the documentation, SCI will transmit the information electronically to the Issuing Office (IO) responsible for arranging inspections in the country of supply. Hard copies of the electronic information will also be distributed to the relevant IO.

After receiving the information, the IO will fax the exporter with a Request for Information (RFI) notification. This will request information required to perform the inspection.

The Exporter must respond promptly to our RFI letter, not forgetting that 3 full working days of advance warning are necessary in relation to the required date for inspection. Simultaneously, at the Issuing Office, SCI experts will perform preliminary analysis of the prices and customs tariff codes.

After arrangements have been made, the SCI inspector will perform the physical inspection at the requested site and mutually arranged time.

We recommend that the Exporter’s final invoice be sent to the IO on the same day that the exporter responds to the RFI.


Where a Customs declaration is made without a valid Clean Report of Inspection (CRI), the Importer’s goods will be required to undergo destination inspection which will be carried out by SCI, under the supervision of Nigerian Customs Officers. Shipments subject to destination inspection may also suffer a delay in clearance and a fine amounting to 50% of the assessed value of the consignment.


Yes. Please refer to the list shown in appendix B, where you will also find the list of prohibitions.


1. Upon receipt of the Form M, proforma invoice and Letter of Credit from the Importer, and after having processed the information in these documents, the SCI Liaison Office (LO) in Lagos will transfer the data to the SCI Issuing Office (IO) which will handle your file. The IO will contact you in writing, usually by fax. The letter is referred to as the RFI (Request For Information) and will ask you for the information we require in order to carry out our physical inspection of your goods and to perform customs classification and price verification. The RFI letter will detail pertinent references including a unique RFI locator number, for example SCI 123456.

2. Please quote the unique RFI number in all communications with SCI so the file record can be immediately located and the swiftest possible action be taken.

3. If any company other than the Exporter named on the Form M is to request inspection or act in any way on your behalf, their authority to do so must be confirmed by you as the named Exporter.


The fee is paid by the Federal Republic of the Government of Nigeria. However, where a discrepancy is detected on the first inspection and an additional inspection visit is required, SCI reserve the right to charge the Exporter for the second inspection.


As soon as you have received the RFI letter from SCI (and if your goods are ready) you should submit a written request for inspection to SCI. We ask for a minimum advance notice of 3 full working days for the requested inspection date, although we will always try to accommodate you when an urgent inspection is required. Your written inspection request should detail the following:

• The relevant SCI reference number

• Desired date and location of the inspection,

• The name of the person to be contacted at the inspection site with their telephone and fax numbers.

• Full details of the goods to be inspected

At the time of making your inspection request, if possible please provide a copy of your final invoice.


Goods should be presented along with the export packaging which will be used. Where packaging must be opened to perform physical inspection, repackaging will be observed at the time of inspection.

Where goods are to be exported by full container load, SCI are required to witness loading and seal the container with an SCI seal. For this to be done, Exporters will be required to present goods for physical inspection at a time and place such that, upon the same visit, the SCI Inspector may properly inspect the goods, witness container stuffing and perform sealing.


All goods can be classified under a customs tariff code which determines the rate of duty payable for the goods upon importation. SCI is required to determine the correct tariff code in accordance with the requirements of the Nigerian tariff book and all other relevant regulations published by the Ministry of Finance in Nigeria. SCI will determine the correct tariff code by review of documentation taken in consultation with the results from the physical inspection of the goods. The Nigerian Customs tariff is based on the Harmonised System (HS).


1. The customs valuation/ price verification undertaken by SCI seeks to determine whether the price being charged by the seller, as declared to us in the final invoice, corresponds within reasonable limits with export prices generally prevailing in the country of supply.

2. Where freight charges are not presented to the IO by the exporter, SCI will assess values for these for customs valuation purposes only.

3. The reference date for customs valuation/ price verification will be the date of the order or proforma invoice.

4. Where our customs valuation indicates that your prices are significantly below the reasonable limit for the export prices prevailing in the country of supply, you will be contacted and given an opportunity to comment. Our assessment of the fair market value will only be amended if you can provide us with information which will cause us to change our opinion. In the case of overpricing, you may be asked to reduce your final invoice in line with the fair market value.

4. Price data and all related information supplied to SCI is held in the strictest confidence.


The Exporter will receive a certified invoice with a hologram label or sticker affixed to it. This will be returned to the Exporter by the normal postal service, unless a specific request is received for it to be sent by courier service. If the Exporter does request for it to be sent by courier the cost will be for the Exporters account.


SCI will issue the Importer (via the dealer bank) with a Clean Report of Inspection (CRI). The CRI will include SCI’s assessment of the customs value and tariff classification.

The CRI will be issued to the Importer, provided the following conditions have been met:

1. An accepted Inspection Report has been issued by SCI to confirm that the quality and quantity of the goods meet the specification submitted to SCI;

2. The Exporter has submitted correct final documentation to SCI;


1 We need a clean final invoice as early as possible in the PSI process for CRI issuance, as it will enable early customs clearance of the Importer’s cargo. The clean final invoice must detail the following information:

. Invoice number and date of issuance;

. Names of the Importer and Exporter, as per the proforma and Form M;

. Detailed quantity and description of goods;

. All unit prices and extensions;

. Separate itemised charges, if applicable, up to FOB;

. The FOB (Free on Board) value of the transaction;

. Freight (if applicable);

. Insurance (if applicable);

2 A copy of the signed, clean- on- board transport document (bill of lading/ airway bill) and a copy of the letter of credit. This is relevant to issuance of the certified invoice.

3. Final invoices which show a price adjustment arising from fluctuating exchange rates cannot be accepted unless expressly allowed for under the terms and conditions of the proforma invoice.

– The CRI number must be shown on the Bill of Lading, Airway Bill or the like and written against each item in the cargo manifest. It can be generated very simply by taking the SCI number and adding the three digit suffix relevant to the partial shipment, i.e. 001 (partial 1), 002 (partial 2) etc…

– The Exporter must provide the final invoice within 72 hours of inspection, otherwise SCI valuation will be based on the documents already available.


Presentation of clean final documents should be made to SCI as soon as they are available. Failure to do so may result in the issuance of a Discrepancy Report of Inspection (DRI) and a delay in the clearance of the Importer’s goods from Customs.

In order to avoid problems, it is advisable that good final invoices be presented to ITS at the time that you submit your request for inspection.


1. If the information in these guidelines does not provide an answer to questions that arise in relation to a specific order, please contact your nearest SCI Issuing Office where trained SCI personnel will be happy to assist.

2. SCI is a founder member of the International Federation of Inspection Agencies (IFIA) and the Nigerian PSI programme is carried out in conformity with the IFIA code of practice.

3. SCI also carries out its work in accordance with the WTO agreement on Pre- shipment Inspection.

4. Despite every effort being made by SCI to facilitate the progress of all orders which require an inspection, an exporter may occasionally experience a problem. SCI has an Internal Appeals Procedure as required by Article 2.21 of the Agreement on pre- shipment inspection of the Uruguay round of WTO/ GATT. Exporters wishing to make use of these procedures should request details from their nearest Foreign Trade Standards office.

5. Exporters/Importers wishing to communicate with ITS by electronic mail should take note of the following important message.

Email is subject to the possibility of delays and of transmission failure. Systems designed to inform senders of transmission failure are themselves subject to the possibility of delay and may fail altogether. It follows that you should not assume that email transmission have been received in good order unless you are advised by ITS that this is the case.

ITS will systematically confirm receipt of email by email. The confirmation sent by ITS is to confirm receipt only. It should not be taken as acceptance of the content of the document. It is recommended that you call where such confirmation is not received within 24 hours.


Swede Control/Intertek is responsible for the inspection of all goods supplied from the following countries:

United States of America and The Caribbean including Nordic Nations

Denmark (including Greenland)

Dominican Republic










South America Europe

Argentina Austria

Bolivia Bulgaria

Brazil Czech Republic

Chile Hungary

Cuba Macedonia

Ecuador Poland

Guyana Romania

Paraguay Slovakia

Peru Yugoslavia (Serbia/Montenegro)






The following goods are the only ones exempt from pre-shipment inspection:

a) Explosives & pyrotechnic products

b) Arms, ammunitions, weapons & implements of war

c) Used motor vehicles

d) Personal effects

e) Perishables (i.e. day old chicks, vaccines, human eyes, human remains, periodicals or magazines, yeast)

f) Supplies to diplomatic consulate missions and international organisations for their own needs


1. Sorghum (HS Code 1007.0000)

2. Millet (HS Code. 1008.2000).

3. Wheat flour (HS Code. 1101.0000).

4. Mosquito Repellent coils (HS Code 3808.1110).

5. Retreaded/ used tyres (HS Code 4012.1000-4012.9000).

6. Gaming machines (HS Code 9504.1000-9504.3000).

7. Second-hand Clothing (HS Code 6309.0000)

8. Cement not in bulk form (HS Code 2523.2910). Cement can only be imported in bulk form and cannot be brought into the country in quantities less than 10,000 metric tonnes or the full capacity of the carrying vessel. It shall in addition, be discharged into silos at the quayside or into a ship permanently moored to the Coastline or into trucks for onward delivery to the hinterland for packaging into 50kg bags using machinery and facilities already installed at those locations.

9. Bulk importation of vegetable oil is no longer allowed for health reasons. All imports shall be branded and in cans.

Please note that the list of Prohibited items for Nigeria is subject to frequent changes. SCI have provided this list as a reference for exporters to Nigeria. The list of Prohibited items, as set by the Government, will always take precedence over the information contained in these Guidelines.

Appendix C