Nigeria issues the Companies Income Tax (Significant Economic Presence) Order, 2020


The Finance Act 2019 heralded the introduction of a new framework for the taxation of e-commerce in Nigeria and this was to be based on the Significant Economic Presence (SEP) principle. The Finance Act however did not define the principle but rather granted the power to the minister to provide a definition. In the exercise of this power as contained in section 13(4) of the Companies Income Tax Act Cap C21 LFN 2004 as amended (CITA), the Federal Minister of Finance by an order dated 3rd February 2020 published the Companies Income Tax (Significant Economic Presence) Order 2020 (the Order) in the federal gazette in a bid to define the SEP principle and aid its implementation and enforcement.

We have reviewed the provisions of the Order and its impact on the taxation of non-resident entities in Nigeria.

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