10 February 2016 Nigerian Tax Appeal Tribunal refutes deductibility of recharges under Deemed Profit Tax regime The Lagos Division of the Nigerian Tax Appeal Tribunal (TAT) on December 18, 2015, ruled in favor of the Federal Inland Revenue Service (FIRS) in an appeal case brought before it by VF Worldwide Holdings Ltd (the Company or VFWHL). The issue in dispute was the tax deductibility of recharges paid by VFWHL to its Nigerian subsidiary VF Nigeria Limited (VFNL) for the execution of the Nigerian portion of the contract under an agreed service agreement. The TAT ruled in favor of the FIRS, affirming its position that recharges paid to the Nigerian subsidiary did not qualify as a valid deduction for tax purposes under the (then prevailing) deemed income basis for the filing of the tax returns by nonresident companies. Document ID: 2016-0288 |
