The FIRS has issued a Public Notice (PN) providing additional information on its recently released Income Tax (Transfer Pricing) Regulations 2018 (TP Regulations). The FIRS also issued an Information Circular No: 2018/03 (the Circular) with specific guidelines on TP documentation requirements in Nigeria for the benefit of all relevant stakeholders.


Public Notice on the TP Regulations

The PN reiterates that the commencement date of the TP Regulations is 12 March 2018. However, the FIRS will grant taxpayers a grace period up to 31 December 2018 to enable them to fulfil all outstanding TP obligations such as filing of TP returns and submission of TP documentation etc. Nonetheless, the FIRS shall commence full imposition of the administrative penalties contained in the TP Regulations in the event of failure to regularize these obligations at the expiry of the grace period.

Guidelines on TP Documentation

The Circular addresses broad issues relating to the form and content of TP documentation. Some of the specific guidelines in the Circular include the following:

  1. Taxpayers are required to adopt a three-tiered structure for TP documentation (i.e. Master File, Local File and Country by Country Reports). The Circular also provides detailed guidance on the expected content of each of these documents;
  2. Taxpayers whose total value of controlled transactions are less than N300million are to furnish the FIRS with their Master Files and Local Files within 90 days of receiving the FIRS' request to submit their TP documentation;
  3. The FIRS may grant valid requests for extension of time to comply with a notice. However, the Circular specifies conditions under which such extensions may be granted which would include: death or serious illness of a key personnel, fire or natural disaster, civil unrest, public holiday occurring during the period of notice and any other genuine incident preventing the company from complying with the notice;
  4. Taxpayers are to review and update their TP documentation annually to ascertain that the facts and circumstances contained therein are still valid;
  5. The FIRS does not expect taxpayers to prepare TP documentation in the following circumstances:
  • Where the total value of controlled transactions is less than N300million;
  • Where the related party transactions are covered by an Advance Pricing Agreement (APA), provided that the taxpayers keep to the terms of the APA;
  • Where the related party transactions are priced in accordance with the requirement of Nigerian statutory provisions. For example, prices regulated by statute;
  • In any other situation mentioned in other guidelines that would be issued from time to time.


The issuance of the PN and the Circular indicates the FIRS' readiness to fully implement the provisions of the TP Regulations. In view of the huge administrative penalties and increased compliance requirements, taxpayers are encouraged to be proactive and put in place measures to fulfil all outstanding TP compliance obligations before 31 December 2018 and ensure compliance with the new TP Regulations.

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.