Big Data Analytics And The Nigerian Withholding Tax Rates

The Tax Appeal Tribunal ("TAT") Lagos Zone on 30 November 2020 decided in the case between Tetra Pak West Africa Limited ("Tetra Pak") and Federal Inland Revenue Service ("FIRS") that sales in the ordinary course of a company's business are exempt from withholding tax (WHT) in line with the provisions of the WHT Regulations pursuant to the Companies Income Tax (CIT) Act, Cap. C21, Laws of the Federation of Nigeria (LFN), 2004 (as amended) (CITA).

It is important to note that whilst it is generally understood that sales in the ordinary course of business are exempted from WHT deductions in Nigeria, the main issue is the definition of the phrase. The WHT Regulations itself does not help matters since the term is neither defined nor guidance provided for its application. It is generally believed that everyone acts in the course of its ordinary business. Due to different interpretations by taxpayers and the tax authorities alike, Tetra Pak approached the courts