According to the Public Notice, the NRPTO was established to enhance tax certainty, promote voluntary compliance, reduce tax disputes and avoid double taxation relating to non-resident persons who are liable to tax in Nigeria in accordance with the provisions of the Companies Income Tax Act and the Personal Income Tax Act. 

Consequently, all non-resident taxpayers (corporate and individuals) shall, effective 1 January 2020, be required to submit their tax returns, correspondence and enquiries to the NRPTO where their files shall be domiciled. The NRPTO is located within the International Tax Department of the FIRS office at #17B Awolowo Road, Ikoyi, Lagos.

Comments

The creation of a specialized tax office for non-resident taxpayers by the FIRS is a step intended to further simplify tax administration in Nigeria and improve voluntary compliance by the affected taxpayers. This is a departure from the status quo where non-resident taxpayers were allocated to different FIRS tax offices based on the size of their turnover and industry, in the case of non-resident companies operating in the oil and gas industry.

Although the Public Notice does not specify whether the FIRS will automatically transfer non-resident persons’ tax files to the NRPTO, the affected taxpayers should proactively engage with the FIRS to ensure a seamless transition.

Meanwhile, the FIRS needs to clarify how it intends to deal with the potential challenges for non-resident persons operating outside Lagos State. Would such persons be required to submit their tax returns at the FIRS’ Ikoyi office in Lagos? Or would branches of the NRPTO be established in each State in Nigeria for the affected taxpayers’ convenience? Or would the FIRS leverage technology for e-filing by the taxpayers to address this challenge? It is important for the FIRS to clarify this issue before the commencement date to avoid similar administrative challenges being experienced by “pioneer companies” who are required to file their tax returns at an FIRS’ office in Abuja.

Please access the FIRS Public Notice via this link.

For any enquiries or feedback on the above, please contact:

Wole Obayomi

ng-fmtaxenquiries@ng.kpmg.com