Nigeria Tax FAQs - Frequently Asked Questions

A: TIN stands for Tax Identification Number. It's an 11-digit number issued by FIRS that identifies you for tax purposes. You need it to:

• File tax returns
• Open business bank accounts
• Register businesses
• Bid for government contracts
• Get a Tax Clearance Certificate

Learn how to get your TIN

A: You must pay tax if you:

• Earn income in Nigeria (residents and non-residents)
• Are employed (PAYE applies)
• Run a business or are self-employed
• Earn income from investments, rent, or other sources

Even if your income is below the tax-free threshold (₦800,000), you should still file a return if you earn income.

A: The first ₦800,000 of your annual income is tax-free. This means you don't pay tax on the first ₦800,000 you earn each year.

Example: If you earn ₦1,500,000, only ₦700,000 is subject to tax.

A: Personal income tax uses progressive rates:

• First ₦800,000: 0% (tax-free)
• Next ₦200,000: 7%
• Next ₦500,000: 11%
• Next ₦500,000: 15%
• Next ₦1,600,000: 19%
• Next ₦3,200,000: 21%
• Above ₦6,800,000: 25%

See complete tax brackets

A: You can get a TIN online or offline:

• Online: Visit FIRS website, register on the taxpayer portal
• Offline: Visit FIRS or State IRS office with required documents

Processing time: 24-48 hours (online) or 3-7 days (offline)

Complete TIN registration guide

A: No, you should have only one TIN. If you think you have multiple TINs, contact FIRS to consolidate them. Having multiple TINs can cause compliance issues.

A: You can retrieve your TIN by:

• Logging into FIRS taxpayer portal (if you registered online)
• Contacting FIRS with your name, date of birth, and email/phone
• Visiting FIRS office with identification

A: Deadlines vary:

• Individual returns: March 31st of the following year
• Company returns: 6 months after year-end
• VAT returns: 21st of each month

See complete deadline calendar

A: You can file online or offline:

• Online: Log into FIRS taxpayer portal, complete return form, submit
• Offline: Visit FIRS office, complete paper form, submit

Step-by-step filing guide

A: You'll need:

• PAYE certificate (if employed)
• Income statements
• Receipts for deductions (rent, pension, etc.)
• Bank statements
• Business records (if self-employed)

See complete document list

A: File as soon as possible. Late filing attracts penalties:

• ₦100,000 initial penalty
• ₦50,000 per month for each month late
• 10% interest per annum on unpaid tax

You can request an extension before the deadline, but it's not guaranteed.

A: Only certified tax professionals can legally file tax returns on your behalf. They must be certified by one of these recognized bodies:

• Chartered Institute of Taxation of Nigeria (CITN)
• Institute of Chartered Accountants of Nigeria (ICAN)
• Association of National Accountants of Nigeria (ANAN)

These certified professionals can prepare and file your returns, but you remain legally responsible for the accuracy of the information. Always verify that your tax agent is certified before engaging their services.

Note: Only FIRS and State IRS can assess and collect taxes - private individuals cannot perform these functions.

A: You can claim:

• Tax-free threshold: ₦800,000
• Rent relief: 20% of rent (max ₦500,000)
• Pension contributions
• NHF contributions
• NHIS contributions
• Life insurance premiums
• Mortgage interest (if owner-occupier)
• Medical expenses
• Charitable donations

Complete deductions guide

A: No, rent relief is only for people who pay rent. If you own your home, you can claim mortgage interest instead (if you have a mortgage).

A: You can claim 20% of your annual rent, up to a maximum of ₦500,000.

Example: If your annual rent is ₦2,000,000, you can claim ₦400,000. If your rent is ₦3,000,000, you can only claim ₦500,000 (the cap).

A: Late filing penalties:

• ₦100,000 initial penalty
• ₦50,000 per month for each additional month
• 10% interest per annum on unpaid tax

Example: Filing 3 months late = ₦100,000 + (₦50,000 × 3) = ₦250,000 in penalties.

See penalty details

A: You can:

• Contact FIRS to request a payment plan
• Make partial payments to reduce interest
• File your return on time even if you can't pay (to avoid filing penalties)
• Negotiate with FIRS based on your financial situation

A: In some cases, FIRS may waive or reduce penalties, especially for:

• First-time offenders
• Genuine mistakes
• Financial hardship cases
• Reasonable cause (e.g., illness, natural disasters)

You must write to FIRS explaining your situation and request penalty waiver.

A: Company tax rates:

• Small companies (turnover < ₦25M): 0% (tax-free)
• Standard companies: 30%

A small company must have turnover below ₦25 million and meet other criteria.

A: You must register for VAT if your annual turnover is ₦25 million or more. You can also register voluntarily if your turnover is below this threshold.

Complete VAT guide

A: The VAT rate is 7.5% (increased from 5% in 2020).

A: Yes, freelancers must pay tax on their income. You're considered self-employed and must file a Personal Income Tax Return.

Freelancer tax guide

A: If you're a resident of Nigeria (spent 183+ days in Nigeria), you're taxable on:

• Income from work performed in Nigeria (even for foreign clients)
• Income remitted to Nigeria

Non-residents are only taxable on Nigerian-source income.

A: Yes, freelancers can deduct legitimate business expenses such as:

• Home office expenses
• Equipment and software
• Professional services
• Marketing expenses
• Business travel

A: A TCC is a certificate from FIRS confirming you've fulfilled your tax obligations. It's required for government contracts, loans, and some business transactions.

Complete TCC guide

A: TCC processing typically takes 7-14 working days, depending on your tax compliance status.

A: A TCC is typically valid for 1 year from the date of issue. Some contracts may require a TCC issued within the last 6 months.