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Taxation Of Offshore Assets: Highlights Of The Presidential Executive Order No. 8 Of 2018


The VOARS offers various reliefs to eligible taxpayers who take advantage of the Scheme while it subsists. As provided in the Order, the benefits to be derived by eligible persons and entities who truthfully and voluntarily make appropriate declarations, pay the required taxes/one-time levy and comply with all the regulations governing the Scheme, include the following:

  • permanent waiver of criminal prosecution for tax offences in relation to offshore assets,

  • waiver of penalties and interest on the declared and regularized offshore assets;

  • immunity from tax audit of the declared and regularized offshore assets;

  • receipt of Offshore Assets Regularization Compliance Certificate from the FGN on the declared and regularized offshore assets; and

freedom to use or invest their duly regularized residual offshore assets in any manner in Nigeria or overseas, and thereafter be subject only to payment to the FGN of annual tax on income earned on the residual offshore assets.

However, it should be noted that the stated reliefs/benefits are not guaranteed in all situations. Specifically, eligible taxpayers who participate under the Scheme are only qualified to receive the waivers and benefits, where such will not prejudicially affect or invalidate any court order or judgement already obtained, in respect of any default in payment of tax for which interest and/or penalty have already accrued.


The key objectives of the EO8 remain largely the same with that of the EO4 which was effected between July 2017 and March 2018 on the Voluntary Assets and Income Declaration Scheme (“VAIDS”). As was the case with VAIDS, the FGN, in addition to curbing corruption and illicit financial flows, intends to boost its revenues by expanding the country’s tax base and encouraging compliance among taxpayers through VOARS. Notably, every taxable person/entity in Nigeria is under statutory obligation to voluntarily declare income earned and assets acquired from all sources, including offshore assets, file appropriate tax returns annually and pay the tax due to the relevant Tax Authority. 

The FGN has indicated its resolve to make use of the information it has obtained on all Nigeria-related offshore incomes and assets through automatic exchange of information (“AEI”) with other countries to prosecute tax offenders who fail to regularize their tax status in respect of offshore assets under the Scheme. It would be recalled that Nigeria is a signatory to the Treaty on AEI (an initiative of The Global Forum on Transparency and Exchange of Information for Tax Purposes) which, as at December 2017, had been signed by over 95 countries for the purpose of global exchange of information on illicit financial flows and tax evasion.

Similar instruments to VOARS have been used by many countries of the world. Since the 2016 revelations from the Panama Papers, many countries have shown renewed interest in, and beamed searchlight on, the activities of their citizens which have the effect of tax evasion through investments hidden in offshore tax havens.  They are increasingly relying on global platforms/initiatives, such as the AEI, to curb the incidence and seek recovery and repatriation of evaded taxes. As reported by the Organisation for Economic Cooperation and Development (OECD), Australia recovered about 326 million EUR in 2013 due to exchange of information. Sweden recovered 130 million EUR due to AEI requests and 200 million EUR due to voluntary disclosures between 2010 and 2014. France recovered about 1.85 billion EUR as at September 2014 under its voluntary disclosure program while the total amount received by countries in unplanned additional revenue as a result of voluntary disclosure programmes and other similar initiatives (in the lead-up to the first exchanges done pursuant to the AEI Treaty) stood at circa 80 billion EUR as at March 2017.

We note that the EO8 is silent on the status of offshore incomes and assets whose owners have participated and obtained amnesty previously under the VAIDS. It is however presumed that amnesty granted in respect of offshore incomes and assets already declared and regularized under VAIDS, should have equal effect as a compliance certificate granted under VOARS for the same set of offshore assets. It is suggested that the Regulations should clearly exempt owners of such assets from the ambit of VOARS or expressly state that clearance certificate issued under VAIDS suffices for the purposes of VOARS to avoid cases where persons cleared under VAIDS become subjects of tax audits and prosecution for failing to comply with VOARS. At any rate, owners of offshore assets are advised to seek professional advice on their tax compliance status and in appropriate cases, take necessary steps to comply with the Scheme.

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DISCLAIMER: This article is only intended to provide general information on the subject matter and does not by itself create a client/attorney relationship between readers and our Law Firm. Specialist legal advice should be sought about the readers’ specific circumstances when they arise.