Nigeria: Court of Appeal overturns Federal High Court ruling on recharges by non-resident companies

ATL-Editor 9 December 2014

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Court of Appeal overturns Federal High Court ruling on recharges by non-resident companies

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In brief

The Court of Appeal (“CA”) on 2 December 2014 delivered a judgment on the deductibility of recharges by non-resident companies filing income taxIncome Tax is a direct levy imposed by governments on the income generated by individuals, corporations, and other entities within a specific jurisdiction. It serves as a major source of revenue for governments and funds various public expenditures, such as infrastructure projects, healthcare, education, national security, and welfare programs. The tax is generally calculated as a percentage of the taxable...tax returnsA Tax Return is a formal statement filed by an individual or entity that details income, expenses, and other pertinent tax information to a tax authority. Its primary purpose is to assess tax liability, determine refunds owed, or highlight outstanding taxes due. Tax returns may include information about earnings, capital gains, allowable deductions, and credits, depending on the tax regulations... under the deemed profit regime in a case brought before it by the Federal Inland RevenueTax authorities are fundamental institutions within government frameworks, overseeing tax assessment, collection, and administration. Their operations ensure that tax laws are enforced and public funds are collected efficiently. This article delves into tax authorities' purpose, responsibilities, and structure, offering insights into their essential role in supporting government functions and economic stability. What is a Tax Authority? A tax authority is...Revenue ServiceTax authorities are fundamental institutions within government frameworks, overseeing tax assessment, collection, and administration. Their operations ensure that tax laws are enforced and public funds are collected efficiently. This article delves into tax authorities' purpose, responsibilities, and structure, offering insights into their essential role in supporting government functions and economic stability. What is a Tax Authority? A tax authority is... (“FIRS”) against Halliburton West Africa Limited (“HWAL”).

The CA overturned the decision of the Federal High Court (“FHC”) which had set aside the judgment of the Body of Appeal Commissioners (“BAC”) that decided the case in favour of the FIRS. The CA ruled in effect that where a non-resident company is assessed to tax on deemed profits basis, additional tax assessmentsA tax assessment is a formal determination made by a tax authority to calculate the amount of tax an individual or entity owes. It is a comprehensive evaluation based on financial records, declared income, expenses, deductions, and any applicable tax laws or regulations. Tax assessments may arise from routine self-assessments by taxpayers, or they may be conducted by revenue authorities... can be raised by the FIRS on the discovery of new facts or previously undisclosed information

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Nigeria: Tax Appeal Tribunal applies Court of Appeal decision on recharges by non-resident companies

http://zaimages.gmimage3.com/za_members/68731/ftp/Attachments/PwC_Tax_Alert_-_TAT_affirms_CA_ruling-_Weatherford_case(3).pdf?utm_source=PwC&utm_medium=email&utm_term=NewsletterLink&utm_campaign=Tax+Appeal+Tribunal+applies+Court+of+Appeal+decision+on+recharges+by+non-resident+companies&utm_content=

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