1. Acquisition of Real Property

The Land Use Act, Cap. L5 LFN 2004 (the "LUA") is the principal legislation governing the acquisition of interests in real property. Under the LUA, legal title to all land in each constituent State in the Nigerian federation is vested in the Governor of such State, who holds same in trust for the people of the State. Accordingly, there is no ownership in fee simple, and the highest level of interest held in land is a right of occupancy granted by the Governor of State or a local government authority, evidenced by a Certificate of Occupancy.

Foreign entities seeking to carry on business in Nigeria can legally hold interests in real property, subject to certain restrictions. For instance, by virtue of Sections 1(i)(a) and 2(1) of the Acquisition of Lands by Aliens Law, Cap 2 Laws of Lagos State 1994, the Lagos State government allocates lands to foreign companies and individuals for a maximum tenor of twenty-five (25) years. However, this restriction is not strictly enforced.

  1. Tax Registration

The CITA provides for the taxation of profits of companies (other than oil & gas producing companies). For this reason, all companies assessable to tax under CITA must register with the FIRS and obtain a tax identification number ("TIN"), immediately after incorporation. The TIN must be reflected on all returns filed or correspondence exchanged with the FIRS.

The Personal Income Tax Act, Cap P8, LFN 2004, as amended by the Personal Income Tax Act 2011, establishes a pay-as-you-earn tax system whereby employers are required to act as agents of the tax authorities for the purpose of collecting and remitting taxes on salaries due to their employees. For this purpose, every employer is required to register with the zonal office of the tax authority in the State where its place of business is located. This registration is expected to be undertaken immediately after incorporation.

By the provisions of the Value Added Tax Act, Cap V1, LFN 2004 as amended by the Value Added Tax Amendment Act No. 12 of 2007, all manufacturers are required to register with the FIRS within six (6) months of commencement of business.

We trust that the foregoing provides an insight into the business climate in Nigeria; and we remain available to render specific advisory services (including in relation to matters contained in this manual) where you require same.

The information contained here is based on relevant Nigerian laws, regulations and practices applicable to doing business in Nigeria, as of November 14 2018. This Manual only highlights legal issues, in general, and is not exhaustive. Also it does not, and it is not intended to, constitute legal advice and or opinion. If you have questions or require advice in respect of matters contained herein or any other specific issues, kindly contact us for such advice and we would be happy to assist you on an individual basis and walk with you on your journey to explore the limitless opportunities for investments in Nigeria.

Banwo & Ighodalo does not accept liability for any action (or lack thereof) by you or anyone else as a result of reliance on, or any other use of, information contained herein. For the avoidance of doubt, under no circumstance shall Banwo & Ighodalo be liable for any consequences resulting from reliance on or use of information contained in this Manual.

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.