Nigeria’s long-awaited tax reforms officially took effect on 1 January, 2026, following the signing into law of four major Acts in 2025:
- Nigeria Tax Act 2025 – Revises major substantive tax rules, thresholds, and definitions
- Nigeria Revenue Service (Establishment) Act 2025 – Replaces FIRS with NRS as the central authority
- Nigeria Tax Administration Act 2025 – Consolidates tax administration procedures
- Joint Revenue Board of Nigeria (Establishment) Act 2025 – Coordinates state-federal tax activities
However, their implementation has not come without chaos. Unprecedentedly, multiple (up to three) conflicting gazetted versions of these laws surfaced, creating widespread confusion. The National Assembly later declared that the versions initially published did not match the versions passed by the legislature. In response, it released a harmonised “final” gazetted version (downloadable here- https://drive.google.com/drive/folders/1Zeh1m33wgwcuZyzBJf-U6ExB7WqhaSHa) correcting inconsistencies and clarifying provisions, such as:
- Aligning the threshold for “small businesses” and “small companies” at ₦100 million annual turnover
- Resolving definitional and drafting inconsistencies across the Acts
While many professionals still suspect patch-up efforts were made behind the scenes, the harmonized versions are now the official legal basis for tax compliance going forward.
Key Takeaway for Businesses: These Laws Are Now in Effect
Despite the controversies, the reforms are now enforceable. All businesses, from startups to conglomerates – must now take swift action to align with the new legal framework.
What Should Businesses Begin to Do Immediately?
1. Study the Final Gazetted Versions
CFOs and tax leads should ignore earlier conflicting gazettes and focus only on the National Assembly’s final harmonized versions.
2. Conduct a Full Impact Review
Evaluate how the new reforms affect your business operations, legal structure, and financial arrangements.
3. Update Internal Tax Systems and Processes
Businesses must:
- Integrate new rates, exemptions, and classifications into self-assessment tools and payroll systems
- Adopt digitised accounting, tax reporting, and document retention systems
- Invest in tax technology that enables automated calculations, filings, and audit traceability
- Educate management and key personnel on the new legal and regulatory expectations
4. Set Up Updated Compliance Calendars
Establish a robust monthly compliance calendar to ensure timely and accurate fulfilment of the following:
- PAYE remittances for employers and businesses
- VAT filings – Ensure monthly VAT filings capture all VAT on business expenses, capital/fixed assets, and other allowable input VAT for claims
- Other filings – Transfer Pricing (TP) returns, Controlled Foreign Company (CFC) returns, incentive returns, and returns by virtual asset providers
- Corporate Income Tax (CIT) and CGT self-assessments and filings, incorporating new thresholds, exemptions, and top-up provisions
- 4% Development Levy – A new 4% Development Levy replaces overlapping sector-specific charges (e.g., NASENI, TETFund, NITDA). It applies across board to qualifying companies.
- Filing of tax planning returns, notifications of accounting date changes, and business reorganisation disclosures
- WHT filings (under the reinforced TAA) – The Nigeria Tax Administration Act 2025 strengthens WHT enforcement – including: Penalties for failure to deduct or remit and tighter audit controls on contract and vendor payments
5. Assess E-Invoicing Readiness and Integrations
With e-invoicing now mandatory under the reforms:
- Register and obtain e-invoicing credentials with the NRS
- Integrate your ERP or accounting systems
- Train staff on how to generate, issue, and submit compliant e-invoices
6. Implement Strong Risk Management Controls
To manage tax risks proactively:
- Conduct regular tax risk assessments and maintain detailed documentation
- Engage regularly with your tax consultant for guidance, updates, and strategic planning
- Monitor evolving regulatory guidance and align business practices accordingly
- Verify incentive eligibility and tax exemptions periodically
7. Review Transfer Pricing and Group Structures
Enhanced controls on related-party transactions and business presence may affect cross-border operations and restructurings.
8. Prepare for Digital Enforcement and Stronger Audit Powers
The Nigeria Revenue Service (Establishment) Act 2025 introduces new audit capabilities, technology-based enforcement, and centralized revenue collection authority.
A New Tax Era: Be Informed, Be Compliant
The year 2026 begins with sweeping tax reforms now in force. Businesses must rise to the challenge of:
- Staying informed and alert
- Ensuring monthly and annual compliance discipline
- Leveraging e-invoicing and audit readiness
- Adapting to new rules and levies
At Vi-M Professional Solutions, we are already reviewing the final versions of these reforms and are prepared to support clients through:
- Industry-specific updates
- Digital compliance tools
- Real-time tax advisory
- End-to-end monthly tax support
For enquiries about the new tax laws, or to discuss how Vi-M can assist you navigate the compliance obligations under the tax reforms, do not hesitate to send us an email via clients@vi-m.com.