Nigeria Tax Administration Act, 2025 · s.45–s.47, s.52–s.53
Artificial arrangements, and who carries the debt
The tax authority can disregard an arrangement made mainly for a tax benefit — and the tax can follow the people running the business.
Who this lands on: Directors, managers, principal officers and their advisers.
Where a transaction is artificial or fictitious, the tax authority may disregard it and assess the tax as if it had not happened (s.46).
A prohibited tax avoidance arrangement — one whose main purpose is to obtain a tax benefit — can be counteracted, and the benefit removed (s.47).
A manager or principal officer can be held personally liable for the company's tax obligations (s.45), and a manager or agent acting in good faith on the authority's direction is indemnified (s.52).
Where a company is wound up, the tax due does not disappear with it (s.53).
The practical rule: if the only reason for a structure is the tax, expect it to be looked through.