Kevin Crilly, 59, from Jonesborough, County Armagh, is already facing charges of kidnapping and falsely imprisoning the Grenadier Guardsman Captain - who was posthumously awarded the George Cross - near the Irish border on May 14 1977.
Captain Nairac, 29, a dashing former English public schoolboy from Gloucestershire, was interrogated, tortured and then shot dead by the IRA after being snatched from a pub car park near Jonesborough and driven to a field at Ravensdale, County Louth.
His remains have never been found.
Ten years ago, the IRA said it had poinpointed the graves of nine people murdered and buried by the terrorist group, but sadly for his family, Captain Nairac’s body was not among the list of names passed to the authorities. A spokesman said at the time that it had not found his remains, despite several searches to locate it.
Prosecutors laid the murder charge before Crilly as he appeared at Newry Magistrates' Court for a routine bail hearing on the two lesser counts, with which he was charged last year.
Captain Nairac died after taking too many risks after he went undercover in an IRA heartland.
The young Grenadier Guardsman fate was sealed after he sang rebel songs in a bar in the hills of Republican South Armagh. The terror group snatched him from outside the Three Steps Inn at Drumintee, near Jonesborough, close to the Irish border
From there he was driven south into to Ravensdale, County Louth, where he underwent hours of torture before he was shot. It became one of the most endursing and infamous murders during the the Troubles.
Former members of the paramilitary group have claimed that the body was disposed of at a local meat processing plant, It is believed the soldier's remains were disposed of to hide the terrible injuries he suffered before he was killed.
The soldier has been hailed a hero by his military colleagues and was awarded the George Cross.
The citation for the posthumous award praised his resistance to his abductors and bravery under "a succession of exceptionally savage assaults" which failed to break him.
Captain Nairac has been portrayed as a brave but reckless soldier, whose romantic view of his undercover role in Ireland cost him his life.
His sister Gabrielle said: "Robert certainly stuck his neck out. He thought he could get away with it, but in a way we all do. As a small boy he had read Bulldog Drummond, so you can imagine his approach."
Republicans have claimed the undercover operative had been providing information that military intelligence used to assist loyalist paramilitary groups who carried out a string of murders in the South Armagh area.
Captain Nairac was born in Mauritius and had a privileged upbringing, being sent to private prep school, leading Catholic public school Ampleforth College and then on to Lincoln College, Oxford, where he read medieval and military history and excelled in sport.
After university he entered the Royal Military Academy Sandhurst under the sponsorship of the Grenadier Guards and took a commission in the regiment on leaving.
His first tour of duty in Northern Ireland came in 1973 when he spent three months with the Second Battalion of the Grenadier Guards in Belfast.
At the end of his tour of duty he remained on for a time as liaison officer with the replacement battalion.
When his regiment was posted to Hong Kong, he volunteered for intelligence duties in Northern Ireland instead and returned in 1974.
One man, from Dundalk in the Irish Republic, was convicted of murdering Capt Nairac at the Special Criminal Court in Dublin in 1985 and released in December 1997 after serving 12 years.
He told Gardai he shot the soldier and another of the IRA group pretended to be a priest in an unsuccessful attempt to get information out of Capt Nairac, who was a Catholic.
Five South Armagh men were also charged in Belfast in connection with the murder - the first time anyone had been charged in Northern Ireland with an offence committed in the Irish Republic.
Two were convicted of murder and sentenced to life. One was acquitted of murder, but found guilty of manslaughter and given 10 years. The other two received five years and two years respectively on lesser charges.
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