ARTICLE · 09 JANUARY 2014

Transfer Pricing In Context

PwC Nigeria

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Transfer pricing, commonly referred to as TP, is a term used to describe all aspects of intercompany pricing arrangements between related business entities, including transfers of tangible goods, services, intellectual property and financing transactions.

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Context

Transfer pricing, commonly referred to as TP, is a term used to describe all aspects of intercompany pricing arrangements between related business entities, including transfers of tangible goods, services, intellectual property and financing transactions.

Tax authorities reckon that with increasing scale of international businesses and complexity of cross border trade, paying closer attention to transactions between related parties is now necessary in ensuring tax revenues are not improperly allocated to other tax jurisdictions. TP could also be an issue even for related parties that are resident within the same tax jurisdiction.

Recent developments in Nigeria

Specific TP regulations are were released in October 2012 based on the general antiavoidance provisions in the various tax laws which require related party transactions to be conducted at arm's length. The regulations are applicable to basis (accounting) periods commencing after August 2012. For

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