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July 31, 2023

Nigeria | Highlights of the 2023 Guidelines on Mutual Agreement Procedure

  • Nigeria has introduced a protective Mutual Agreement Procedure (MAP) concept.
  • New MAP guidelines allow taxpayers to make multi-year and multilateral MAP requests.
  • Electronic submission of MAP requests will also be permitted.
  • Taxpayers should keep abreast of double-tax agreements that may exist between Nigeria and the jurisdictions where their related parties are domiciled to take advantage of the MAP guidelines.

Executive summary

The Nigeria Federal Inland Revenue Services (FIRS) issued updated Guidelines on Mutual Agreement Procedure (2023 MAP guidelines) in an information circular dated 23 May 2023, thus revoking the MAP Guidelines published on 21 February 2019 (2019 MAP guidelines).

Specifically, the 2023 MAP guidelines introduce some key changes and provide guidance to relevant stakeholders on the procedures for accessing MAP as a dispute resolution mechanism in line with the provisions of the Double Tax Agreements (DTA) between Nigeria and other countries (Treaty Partners).

MAP is an instrument through which tax authorities interact with one another to resolve international taxation disputes that arise when tax authorities have different interpretations of the provision of the DTA. MAP is typically used to resolve disputes on Transfer Pricing (TP) adjustments related to cross-border transactions. However, it is also available to address issues around dual residency, Permanent Establishments (PE), and Withholding Tax (WHT), among other international tax issues.

This Alert summarizes key changes introduced by the 2023 MAP guidelines and the impact of these changes.

Detailed discussion

1. Deletion of the prefiling consultation requirement and introduction of the “Protective MAP” concept

Taxpayers seeking a MAP under the 2019 MAP guidelines were required to carry out a prefiling consultation with the FIRS, which could be accomplished via a meeting or in writing before the submission of a formal request. However, this requirement was deleted in the 2023 MAP guidelines and the “Protective MAP” concept was introduced.

The protective MAP is a type of MAP request submitted within the timeframe specified in the relevant DTA and grants the taxpayer the opportunity to agree with the Competent Authority (CA) to defer examination of a MAP request until further notification is received from the taxpayer.

It can be inferred that MAP requests submitted under the 2019 MAP guidelines were reviewed immediately, except in cases where the taxpayer needed to attend to deficiencies identified by the FIRS. However, the protective MAP seeks to protect taxpayers from missing the timeframe stipulated in the relevant DTA while also affording them ample time to obtain and provide sufficient information that the FIRS may require for the examination of the MAP request. Although the FIRS can deny a MAP request where it is not made within the timeline or due to insufficient information or documents, the decision for FIRS to proceed with the examination of the request rests solely with the taxpayer under a protective MAP.

2. Permissibility of a multi-year MAP request

Recurring issues or transactions can be addressed via a single MAP request covering the relevant periods, under the 2023 MAP guidelines, to the extent that the transactions are substantially the same in facts and circumstances for the relevant years.

Due to the limited practice on the subject, we can infer that the 2019 MAP guidelines required the taxpayer to submit a MAP request for every issue and occurrence. In contrast, the 2023 MAP guidelines allow taxpayers to tender a MAP request for recurring issues and multiple years may be covered under a single MAP request. It also provides taxpayers with certainty on the tax treatment of such recurring transactions.

3. Multilateral MAP and Advance Pricing Agreements (APA)

An APA is an agreement entered into by a tax authority and a taxpayer, clearly stating the TP methodology for determining the price of specific international transaction(s) to be conducted by the taxpayer and its foreign related party(ies). The APA is applicable for an agreed number of years and is subject to the fulfilment of agreed terms. An APA can be regarded as a “dispute prevention” mechanism, while the MAP is a “dispute resolution” mechanism. However, both APAs and MAPs could be:

  • Unilateral – between a taxpayer and a tax authority
  • Bilateral – between two taxpayers and two tax authorities
  • Multilateral – between more than two taxpayers and more than two tax authorities

DTAs, MAPs and APAs, in most cases, are bilateral in nature. However, for multinational enterprises (MNEs) that have different components of a single transaction performed in multiple jurisdictions or even covered under different DTAs, it becomes expedient that where a MAP has been initiated, the resolution of the issue should include all other aspects of the transaction and all jurisdictions affected (provided they are treaty partners). This will enhance tax certainty.

Although implementation of APAs awaits the FIRS’s publication of a relevant guideline in this regard, the inclusion of multilateral MAPs and APAs in the 2023 MAP guidelines indicates that the FIRS believes that international tax or treaty-related disputes are best solved when all contracting states are involved. Doing so also helps protect taxpayers from incidences of double taxation.

4. Additional scenarios in which taxpayers may seek MAP assistance

In addition to TP adjustments, dual residency, PE and WHT issues were provided under the 2019 MAP guidelines as situations in which a taxpayer may seek MAP assistance. The 2023 MAP guidelines include other scenarios such as where there is:

  • Disagreement between the taxpayer and the tax authorities over whether the conditions for applying a treaty anti-abuse provision have been met or applying a domestic law anti-abuse provision conflicts with the treaty
  • Double taxation arising in the case of bona fide taxpayer-initiated foreign adjustment
  • Disagreement with an audit adjustment or audit settlement 

Taxpayers should take note of the additional circumstances under which a MAP process may be sought to harness the benefits of MAP.

5. Deletion of provision allowing CAs to determine time limits for submitting MAP request

Under normal circumstances, the DTA stipulates the timeframe within which a MAP request must be submitted. Where the DTA does not state the timeline for the submission of a MAP request, the 2019 MAP guidelines allowed for the CAs of the treaty partners to agree the applicable time limit.

However, this provision was deleted in the 2023 MAP guidelines, which state that if the DTA has not stipulated the timeline, taxpayers have three years to submit a request. The time limit commences when the taxpayer received a notice from the FIRS for any of the scenarios provided by the guidelines. Failure to submit a request within this timeframe will result in rejection of the MAP request.

Notwithstanding the three-year time limit to apply for MAP, the six-year statute of limitations (for additional tax assessments) should not apply to the matters presented under the MAP request if the issues to be resolved relate to years covered in the relevant assessment notices.

6. Introduction of electronic submission of MAP request

The 2019 MAP guidelines required all MAP requests to be “in writing.” The format for the submission of MAP request was not expressly stated. However, some taxpayers could infer that only hard copies were acceptable, as such requests were to be “submitted” to the FIRS offices.

As part of the FIRS’s drive to promote ease of doing business via electronic interactions with taxpayers, the 2023 MAP guidelines now allows for MAP requests to also be submitted via email.

7. Inclusion of additional specific information in a MAP request

In addition to the information required to accompany the MAP request stated in the 2019 MAP guidelines, the 2023 MAP guidelines also requires that taxpayers disclose the following:

  • Whether the MAP request was submitted to the CA of the other contracting state
  • Whether the MAP request was submitted to another authority under any instrument with treaty-related dispute resolution mechanisms
  • A statement affirming the accuracy of the information provided and that the taxpayer will render assistance as required by the CA in resolving the disputed issues
  • A declaration, in the event of a protective MAP request, that the case is only to be examined when a notification to do so is provided by the taxpayer

8. Introduction of timelines for the submission of additional information

The authorized CA may, in certain situations, require the taxpayer to provide additional information. Under the 2019 MAP guidelines, no timeline was attached to this provision. However, the 2023 MAP guidelines specifies a 30-day timeline from the date of receipt of the notification for submitting additional information requested by the authorized CA. This could be extended by seven days via a reminder to be issued by the CA. Failure to submit the additional information will result in the rejection of the MAP request or the MAP case being closed if the MAP process has begun. Information made available after the deadline but within the timeframe allowed for a MAP request will be regarded as a fresh MAP case.

Taxpayers are therefore urged to ensure that all supporting documents/evidence for every international transaction are retrieved and properly retained to mitigate the risk of rejection of a MAP request and allow for a seamless MAP process.

9. Introduction of time limit for accepting a MAP agreement

The affected taxpayer shall have no more than 14 days to confirm acceptance of the proposed agreement upon receipt of its content in writing from the authorized CA where it has been determined that an agreement will be reached. Once confirmation is communicated, the taxpayer will be unable to seek domestic redress on the case.

10. Tax collection during MAP

Contrary to the provisions of the 2019 MAP guidelines, collection of taxes with respect to the disputed portion of income relating to a pending MAP case will now be suspended. However, any portion of the tax liability that is not in dispute or that is not subject to MAP must be paid.

11. Inclusion of additional guidelines on WHT cases and other cases (including on corresponding adjustments)

For WHT cases, if the MAP agreement results in a partial or full refund of tax withheld, the tax agent or taxpayer is required to submit a formal request to the relevant tax authority. However, for other cases, if the MAP agreement results in a reduction in the income taxable or tax payable, the taxpayer is required to:

  • Present the MAP agreement to the relevant tax authority
  • File amended tax returns if required under the MAP agreement

The tax authority, on the other hand, is required to reassess the taxpayer with the intention to make the MAP agreement effective.  If a refund is due, it should be made within 90 days from the date the taxpayer presented the MAP agreement.

12. Introduction of time limits for the implementation of MAP agreement

The time limits for implementation as specified in the relevant DTA should be adopted irrespective of the time limits specified in the local laws. However, in instances where the tax treaty does not specify time limits, the taxpayer must, within six years after the agreement, present the MAP agreement to the tax authority for implementation.

13. Interaction between MAP and the domestic appeals process

A taxpayer may submit a MAP request while also seeking to exercise its rights of appeal as provided under the relevant Nigeria tax laws. However, the CA may request that the taxpayer suspends the remedies offered by the domestic appeal process where the MAP request has been accepted.

If the taxpayer is unsatisfied with the outcome of the MAP, the taxpayer may continue to pursue remedies domestically. However, the rulings by a court of the CA are binding on all parties and must be adhered to. This notwithstanding, the CA of the treaty partner may offer unilateral relief.


Once again, Nigeria has demonstrated its intention to align with the OECD BEPS Action 14 by releasing updated guidelines on MAP in Nigeria. However, the application of the MAP guidelines may be limited, considering that Nigeria is a signatory to a few DTAs. To give full effect to the MAP guidelines in Nigeria, the Nigerian government should consider entering into more DTAs with other countries as this could help reduce the incidences of double taxation.

Taxpayers are also encouraged to keep abreast of the DTA that may exist between Nigeria and the jurisdictions where their related parties are domiciled to take advantage of the MAP guidelines in Nigeria as MAP, mostly requiring government-to-government dealings with limited involvement of taxpayers, continues to be a less-demanding and less-costly alternative to the domestic appeal process in resolving international tax disputes.


For additional information with respect to this Alert, please contact the following:

Ernst & Young Nigeria, Lagos

Ernst & Young Société d’Avocats, Pan African Tax – Transfer Pricing Desk, Paris

Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London

Ernst & Young LLP (United States), Pan African Tax Desk, New York

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor