From Assessment to Adjudication – Practical Guidance on Tax Objections, Appeals and Resolution Procedures
The Tax Assessment Process
Tax disputes ordinarily begin with an assessment issued by the relevant tax authority.
Under the NTAA 2025, assessments may arise through:
- Self-assessment filings;
- Administrative reviews;
- Desk examinations;
- Tax audits;
- Investigations;
- Best-of-judgment assessments;
- Additional or revised assessments.
The relevant authority may issue assessments where it believes that:
- Returns are incorrect;
- Income has been under-declared;
- VAT has been under-remitted;
- Transactions were improperly characterised;
- Transfer pricing arrangements are non-arm’s length;
- Tax records are incomplete.
Following service of an assessment notice, the taxpayer must decide whether to:
- Accept the assessment;
- Negotiate administratively; or
- Object formally.
Failure to respond promptly may have severe legal consequences.
Objection Procedures under the Nigeria Tax Administration Act 2025
The objection stage is the most critical phase of tax controversy management. Many disputes are won or lost at this stage due to procedural compliance failures.
Section 41 of the Nigeria Tax Administration Act 2025 provides the framework for objections.
Key Requirements for a Valid Objection
A taxpayer disputing an assessment must submit a written notice of objection that:
- Is filed within 30 days of service of the assessment;
- Clearly identifies disputed issues;
- States the alleged errors;
- Specifies monetary values involved;
- Proposes amendments required;
- Provides legal and factual justifications;
- States the amount admitted as correctly payable.
The law also permits objections to be delivered:
- Physically;
- Through courier services; or
- Via electronic means.
Practical Guidance
To maximise success at the objection stage, taxpayers should:
a. Act Immediately
The statutory timeline is short. Internal escalation procedures should begin immediately after receiving an assessment notice.
b. Build a Strong Documentary Record
Tax authorities increasingly rely on electronic data analytics. Taxpayers should therefore maintain:
- Contracts;
- Invoices;
- Transfer pricing documentation;
- Board resolutions;
- Customs records;
- ERP reports;
- Bank records;
- VAT schedules.
c. Separate Technical Issues from Procedural Issues
Strong objections distinguish:
- Computational errors;
- Legal interpretation disputes;
- Factual disagreements;
- Jurisdictional defects;
- Procedural breaches by the tax authority.
d. Avoid Generic Objections
Bare denials rarely succeed. Objections should contain detailed legal and accounting analysis.