The transfer pricing regulations in Nigeria are formally known as the ‘Income Tax (Transfer Pricing) Regulations No 1, 2012”. These regulate contacts between connected taxable persons or controlled transactions. The objective of the regulations is to ensure that transactions between related parties are conducted at arm’s length. Applying the arm’s length principle to controlled transactions can be a time consuming procedure. Therefore, there can be a need to exempt some transactions or categories of taxpayers from the transfer pricing rules application. This part or full exemption is identified as a “safe harbour”.
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