Section 77 Nigeria Tax Act 2025

Section 77 of the Nigeria Tax Act 2025 is about Partnerships. It provides as follows:

(1) A person, other than a company, who engages in upstream petroleum operations either on his own account or jointly with any other person or in
partnership with any other person with a view to sharing the profits arising from the operations, commits an offence.

(2) Where the person referred to in subsection (1) has benefitted from any profits on upstream petroleum operations, the person shall be subject to hydrocarbon tax and income tax under section 78 of this Act on the profits and shall pay a penalty provided under the Nigeria Tax Administration Act, 2025.

(3) Where two or more companies are engaged in upstream petroleum operations either in partnership, in a joint venture or in concert under any scheme or arrangement, tax shall be charged and assessed on them in accordance with subsection (4).

(4) The apportionment of any profits, outgoings, expenses, liabilities, deductions, qualifying expenditure and the tax chargeable upon each company shall be in line with the equity interest of the parties under a jointly executed agreement that will be made available to the Service and where no jointly executed agreement is made available, the Commission shall advise the Service of the approved equity interest of the parties and it shall be binding on the parties.

(5) Subject to this Part, where two or more companies are engaged in upstream petroleum operations either in partnership, in a joint venture or in concert under any scheme or arrangement, the Service may make regulations, for the ascertainment of tax to be charged or assessed upon each company so engaged.

(6) Regulations made under subsection (5) may make provisions –
(a) with respect to apportionment of any profits, outgoings, expenses,
liabilities, deductions, qualifying expenditure and tax chargeable upon each company ;

(b) for the computation of any tax as if the partnership, joint venture, scheme or arrangement were carried on by one company and apportion the
tax between the companies concerned ;
(c) to accept other basis of ascertaining the tax chargeable upon each of the companies; or

(d) which have regard to any circumstances whereby the operations are
partly carried on for any company by an operating company whose expenses are reimbursed by those companies.

(7) Regulations made under this section may be of general application for the purpose of this section and this Part or for a class of arrangement or for a particular application to a specific partnership, joint venture, scheme or arrangement.

(8) The effect of regulations made under this section shall not impose a greater burden of tax upon any company so engaged in any partnership, joint venture, scheme or arrangement than would have been imposed upon that company under this Part, if all things enjoyed, done or suffered by such partnership, joint venture, scheme or arrangement had been enjoyed, done or suffered by that company in the proportion in which it enjoys, does or suffers those things under or by virtue of that partnership, joint venture, scheme or arrangement.

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