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Tax Indemnity Agreement Template for Nigeria

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Key Requirements PROMPT example:

Tax Indemnity Agreement

"I need a Tax Indemnity Agreement for the sale of my Nigerian manufacturing company, where the buyer requires protection against any pre-closing tax liabilities up to January 2025, with specific coverage for ongoing tax audits related to our export operations."

Document background
The Tax Indemnity Agreement is a crucial document used in Nigerian business transactions where one party needs to protect another against potential tax liabilities or risks. This document is commonly utilized in corporate acquisitions, restructurings, or major business transactions where historical or future tax exposures need to be allocated between parties. The agreement must comply with Nigerian tax laws, including the Federal Inland Revenue Service (Establishment) Act 2007 and various tax-specific legislation. It typically includes detailed provisions on the scope of tax indemnification, payment mechanisms, and procedures for handling tax claims. The document is particularly important in Nigeria's complex tax environment, where multiple layers of federal and state taxation exist and where tax legislation continues to evolve.
Suggested Sections

1. Parties: Identification of the Indemnitor and Indemnitee, including full legal names and addresses

2. Background: Context of the agreement, including the underlying transaction or relationship giving rise to the tax indemnity

3. Definitions and Interpretation: Definitions of key terms including 'Tax', 'Tax Authority', 'Tax Liability', 'Indemnified Taxes', and interpretation rules

4. Scope of Indemnity: Detailed description of the tax liabilities covered by the indemnity and any exclusions

5. Indemnification Obligations: Core provisions detailing the Indemnitor's obligations to pay, defend, and hold harmless the Indemnitee

6. Tax Treatment of Payments: Provisions addressing the tax treatment of indemnity payments and gross-up mechanisms if applicable

7. Payment Mechanics: Procedures and timeframes for making indemnity payments, including currency and payment methods

8. Claims Procedure: Process for notifying and handling tax claims, including cooperation between parties

9. Duration and Survival: Term of the indemnity and which provisions survive termination

10. Governing Law and Jurisdiction: Specification of Nigerian law as governing law and jurisdiction for disputes

11. General Provisions: Standard provisions including notices, amendments, assignment, and severability

Optional Sections

1. Third Party Claims: Additional procedures for handling tax claims involving third parties - include when third-party claims are likely

2. Security: Provisions for security or collateral to support the indemnity - include for high-value indemnities or where Indemnitor creditworthiness is a concern

3. Tax Records and Access: Obligations regarding maintenance and access to tax records - include for complex tax situations or long-term arrangements

4. Cross-Border Provisions: Specific provisions for international tax implications - include when parties are in different jurisdictions

5. Dispute Resolution: Detailed dispute resolution procedures including arbitration - include for high-value agreements or when preferred over court litigation

6. Change in Law: Provisions addressing changes in tax laws or regulations - include when agreement spans multiple years

Suggested Schedules

1. Schedule 1 - Covered Taxes: Detailed list of specific taxes covered by the indemnity

2. Schedule 2 - Excluded Tax Liabilities: List of tax liabilities specifically excluded from the scope of the indemnity

3. Schedule 3 - Claims Procedures: Detailed procedures for making and responding to tax indemnity claims

4. Schedule 4 - Form of Notice: Template for tax claim notices and other required notifications

5. Appendix A - Power of Attorney: Standard form of power of attorney for tax matters (if required)

6. Appendix B - Relevant Tax Documentation: Copies or lists of relevant tax assessments, returns, or other key tax documents

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
















































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Relevant Industries

Financial Services

Oil and Gas

Manufacturing

Real Estate

Technology

Telecommunications

Mining

Agriculture

Healthcare

Construction

Retail

Transportation and Logistics

Energy

Professional Services

Relevant Teams

Legal

Finance

Tax

Compliance

Risk Management

Treasury

Corporate Development

Mergers & Acquisitions

Company Secretariat

Internal Audit

Relevant Roles

Chief Financial Officer

Tax Director

Legal Counsel

Corporate Lawyer

Tax Manager

Finance Director

Compliance Officer

Risk Manager

Treasury Manager

Financial Controller

Company Secretary

Tax Consultant

Mergers & Acquisitions Director

Corporate Finance Manager

Chief Legal Officer

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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