Section 30 of the Nigeria Tax Administration Act, 2025 (NTAA 2025) imposes a statutory obligation on taxpayers to disclose to the relevant tax authority any tax planning arrangement, scheme, structure, or transaction designed to obtain a tax benefit.

What is a Tax Planning Arrangement?

A tax planning arrangement includes any action, transaction, structure, or series of steps designed, marketed, or implemented to obtain a tax advantage or reduce a tax liability in respect of any tax administered by LIRS.

Who Must Disclose Tax Planning Arrangements?

The disclosure obligation applies to individuals who are tax-resident in Lagos State, employers, sole proprietors, partnerships, and any person earning taxable income within the state. Additionally, tax agents, advisers, consultants, lawyers, promoters, and intermediaries who participate in designing or implementing tax planning arrangements have independent obligations to disclose such arrangements.

Disclosure under any other reporting regime does not exempt taxpayers from also complying with Section 30 of the Nigeria Tax Administration Act.

Taxpayers must disclose arrangements that:

• Are artificial or contrived for the primary purpose of obtaining a tax benefit;
• Exploit loopholes or technical defects in tax laws to reduce liability;
• Shift income, profits, assets, or liabilities to jurisdictions or persons in a manner inconsistent with economic substance;
• Involve non-arm’s-length dealings between related parties;
• Convert taxable income into non-taxable income;
• Defer or accelerate income or gains primarily to obtain a tax advantage.

Timing and Manner of Disclosure.

A reportable arrangement must be disclosed to LIRS within 30 days of implementation, awareness, or execution of a relevant transaction document (whichever occurs first). Disclosures may be made via the LIRS e-tax Portal (www.etax.lirs.net) or by written submission to the Executive Chairman, LIRS.

Non-Reportable Arrangements.

Routine commercial transactions with genuine economic substance, tax planning expressly provided for under law (e.g., statutory exemptions, tax credits), transactions fully compliant with arm’s-length standards where documentation exists, and internal reorganisations with no tax-avoidance motive and no change in beneficial ownership are exempted from disclosure.

Penalties for Non-Disclosure.

Non-disclosure of tax planning arrangements may attract penalties such as an administrative penalty of up to ₦1,000,000, additional tax, interest, and surcharge, or in serious cases imprisonment for a term not exceeding three years, or to a fine or both.