On Thursday 24 May 2018, the OECD released its first annual peer reviews for 95 countries who have expressed their commitment to automatically exchange taxpayer information through the exchange of Country-by-Country (CbC) reports. Nigeria was one of the countries reviewed in the report.

The purpose of the reviews was to monitor the implementation of Action 13 (or the CbC Reporting - requirement) by the members of the Inclusive Framework on the Implementation of BEPS (IFonBEPS).

What the review tells us about Nigeria's CbC Reporting Regulations

  1. Nigeria has a CbCR regulation [Income Tax (Country-by-Country Reporting) Regulations 2018] which is undergoing the final stages of approval and publication in the government gazette.
  2. Multinational groups originating from Nigeria with consolidated revenues of N160billion (about USD 440m) will be required to prepare and file CbC reports.
  3. The first period for which CbC reports are to be filed by Nigerian headquartered groups will be in respect of fiscal years commencing on or after 1 January 2018.
  4. Failure to file a CbC report with the FIRS will attract a penalty of NGN 10million (about USD 28,000) in the first instance and NGN 1million (USD 2,800) for every month in which the failure continues.
  5. Filing incorrect or false CbC reports will attract a penalty of NGN 10million.
  6. Nigeria will not exchange CbC reports with other countries in 2018. This is because Nigeria is yet to finalise the process required for the automatic exchange to take place.

Outcome of the review and issues raised

Based on Nigeria's CbCR Regulations (finalized but not yet published), Nigeria meets all the terms of reference (as agreed by the signatories to the Multilateral CbC Agreement) relating to the domestic legal law and administrative framework.

However, it is recommended that Nigeria should continue to take steps to have Qualifying Competent Authority Agreements in effect with other members of the IFonBEPS. It is also recommended that Nigeria takes steps to ensure that the appropriate use condition is met ahead of the first exchanges of CbC reports.

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