Why exiting Nigeria does not end a company’s tax duties

Corporate exits do not erase tax obligations

Companies may close offices, sell assets, end operations, and even move elsewhere, but exiting Nigeria does not automatically end their tax affairs. Under Nigeria’s new tax administration framework, businesses that cease operations still must file outstanding and final tax returns, raising questions about how tax authorities handle companies after they exit the market. This issue has gained renewed relevance following Uber’s restructuring in Nigeria, highlighting a broader question for multinational companies: what happens to their tax affairs when they leave?

Tax expert Nojeem Yusuf explained that a business leaving a country does not conclude its obligations immediately. Companies still need to submit final tax returns, as cessation does not stop outstanding tax liabilities, ongoing disputes, or the authority’s ability to examine corporate affairs. According to the Nigeria Tax Administration Act (NTAA) 2025, any company that permanently ceases trade or business in Nigeria must file tax returns for the cessation year alongside any outstanding returns.

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The law requires companies to file these returns within six months of permanently ceasing operations in Nigeria. Furthermore, if revenue authorities have initiated audits, corporations must remain engaged to resolve those audits and settle any additional tax due. Even without ongoing audits, an exit triggers tax authorities to commence examinations.

Managing winding up and related party transactions

Shutting down operations is not the final step in a company’s relationship with tax authorities. The NTAA requires every company to designate a representative to manage its tax affairs, running concurrently with the corporate winding-up process governed by the Companies and Allied Matters Act (CAMA) 2020. Writing on the implications of the new law, tax specialist Chizoba Ngwudo noted that insolvency or winding up does not absolve a business of its tax responsibilities. Outstanding liabilities remain collectible from remaining assets and, under specific circumstances, responsible officers.

The tax question becomes more complex when the entity leaving Nigeria is a subsidiary of a multinational group whose parent company continues operations abroad. Although the Nigerian company ceases local operations, transactions between the subsidiary and its foreign parent or related entities remain relevant to the tax authority. This scrutiny is vital when handling outstanding intercompany balances or transferring assets during an exit. Nigeria’s tax framework requires connected transactions to comply with the arm’s length principle, ensuring terms reflect independent market conditions.

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Tax advisers emphasise that corporate closures and physical shutdowns are separate procedures. Multinationals must distinguish between restructuring, transferring a business to another entity, or formally winding up and dissolving the local company. PwC Nigeria highlights voluntary winding up, deregistration, and striking a company’s name from the Register of Companies as distinct routes for managing exit affairs.

Protecting the national revenue base

The scale of company income tax collected by the government underscores why departing businesses matter to Nigeria’s revenue base. According to National Bureau of Statistics (NBS) data, Nigeria collected N9.21 trillion in Company Income Tax (CIT) in 2025, representing a 41 percent increase from the previous year. In the first quarter of 2026, CIT collections stood at N1.37 trillion, demonstrating that corporate taxpayers continue to account for a significant pool of government revenue. Foreign CIT payments formed a substantial portion of these collections, reflecting the vital contribution of multinational and non-domestic businesses.

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To ensure full compliance before departure, tax experts recommend a structured action plan:

• Identify outstanding tax returns and file cessation returns within the six-month statutory period.
• Reconcile tax records with the revenue authority and properly challenge disputed liabilities within applicable timelines.
• Review related-party transactions, transfer-pricing documentation, and the treatment of disposed assets as part of the exit strategy.