₦airaland Forum

Under what category will a business registered as business name not LTD pay tax?


Will the owner of the business name (sole proprietorship) pay income tax and his business registered under a business also pay company tax?



I want to know more about this, please someone with practical knowledge of this should help me throw light on this, thanks

99thEnemy:
Source:
https://irs.gm.gov.ng/docs/national/NIGERIA_TAX_ACT_2025.pdf

A8: If registered as an enterprise (business name), you pay Personal Income Tax. If registered as a limited liability company, you pay Company Income Tax.


With regards to the bolded....

How is this personal income tax calculated for one who runs an Enterprise business name and also will the employees under this kind of business name required to also pay personal income tax?

Is that not double taxation because the Enterprise business first taxes the individual employees salary/wages and remit to the FG and why will the FG still go ahead to tax same employees?!!!!

Please explain with clarity.....
Thanks.

SixSeven:
From a political observer’s perspective, the 2026 tax law in Nigeria has received a lot of attention and criticism, not just because of its content, but because of perception and context. The law was signed under President Bola Tinubu, but many of its features were already in motion under the previous administration, both belong to the same ruling party, the APC, so in reality, the law is a continuation of long-term fiscal policy rather than a sudden change by one leader.


Tinubu’s government is pushing to formalize more of the economy, increase compliance, and broaden the tax base. That’s why we see stricter reporting rules, rent relief documentation, and more detailed bands. So while the previous law was simpler, the new law reflects a political push for modernization, fairness, and higher revenue, even if it’s more complex for everyday Nigerians. Critics focus on complexity and inconvenience, while proponents emphasize progressive relief for low-income earners.

If I look at it from a neutral perspective, the tax is not the problem, it is the perception and reality that there is no benefits being enjoyed by government and there is much exploitation by the ruling class. Our leaders today are so brazen with how they spend our money. There is no accountability so people see the taxes as mere exploitation not exchange for service which is what is the government's responsibility. A typical example is when they want to toll roads. If Nigerians can be comfortable with corruption and paying its price, why do you think they won't want to pay legitimate taxes if they see the value? The cost of paying for generators is more expensive than 24/7 electricity but today Nigerians are not only paying high Tariff for electricity they don't enjoy, they are paying more money for fuel due to their government not using their money well to give them light That Nigerian abroad will pay bills because they can see the service. They pay for internet, electricity, waste and so much but the service is there. Here, they exploit you.

I totally agree with your submission, the new tax law is not d problem but our leaders. Will they be responsible in their financial dealings?

everythingtall3:
You should pray to God so you can be part of those bordered with how to pay tax. No thanking God that you are tax exempted

AMEN
Unlike this prayer Bro

mrvitalis:
You want to tax income on people who earns less than 600 dollars per year

When poverty lines is 3 dollars or 1095 dollars per year

No body earning below 3500 dollars should pay tax in Nigeria none

But the tax law clearly exempts individuals earning ₦800,000 or less annually.

If the tax law is harmless, the government will not be adamant in pursuing it, common sense about Nigerian crop of dirty leadership.

They get the tax money and in the end loot it.
Nigerians say no to unhealthy tax laws.

Eniolohunda:
There's no big deal in this tax law. All developed countries pay tax. Nigerians don't want to pay tax but want development.

The level of stealing in Nigerian can't be compared to other developing countries that utilizes their taxes. For example Malami former AGF of Nigeria in assets alone goof up to N212B and we've not even talk about the money in his bank accounts. Imagine, we have government officials up to 100 stealing such money.

All developed countries pay tax. But their leaders don't go to other countries for medical treatments. That makes the difference. Stop spewing traaaaaaaaash!

Eniolohunda:
There's no big deal in this tax law. All developed countries pay tax. Nigerians don't want to pay tax but want development.

The druggie cocaine-smoking criminal can't tax my hard earned money.

Please don't make racist and tribalistic comments on this section

99thEnemy:
But the tax law clearly exempts individuals earning ₦800,000 or less annually.

Is 800k not less than 600 dollars per year?

All the APC Voltrons have already positioned themselves to post and support this thread. Look at them up there and throughout the topic posting and applauding the wicked taxation.

"Reduce their purchasing power, spread the tax net"

Bola Tinubu, 2020

Image123:
Is that how you heard it's done in saner clime, or that's what that lambarism croner promised you?

Can you intelligently say how much the person earning $600 was paying as tax before, and how much such person is to pay now? All these ignorance over what?

Yes that's how it's done
In the UK 12k pounds are tax free
In the US 15k dollars
In South Africa over 5600 dollars equivalent are bench marke

Lies, fcmb took #1,060 from me this morning from interest of money I had in my savings they tagged it tax

grandstar:
Fantastic information.

No 23 needs some correction.

It is actually 100m and not 50m.

I still give your post a 9.9 out of 10.

₦50 million applies to small companies while ₦100 million applies to small businesses.

99thEnemy:
But the tax law clearly exempts individuals earning ₦800,000 or less annually.

Yeah. I think he's talking of those who earn N801,000.

mrvitalis:
Is 800k not less than 600 dollars per year?

Oh!, Now I get.

luckingto50:
The level of stealing in Nigerian can't be compared to other developing countries that utilizes their taxes. For example Malami former AGF of Nigeria in assets alone goof up to N212B and we've not even talk about the money in his bank accounts. Imagine, we have government officials up to 100 stealing such money.

I can reason with you because you gave me a good reason, in our greediness. You see those other ones dragging me without a reason I no see their drag.

As we move into the new year and with recent tax changes, I’m curious: for Nigerians abroad who send funds (already taxed overseas) into their personal naira accounts, how does the system prevent those funds from being taxed again?

froxydydx:
This tax law is just to target oil and Gas workers

Looool. In a way by increasing tax paid by about 5%, many oil workers will now pay 25% tax.

Also if your company pays severance packages, say N300m, Govt takes 25% of that severance package.

Severance package does not include your benefits as tied to the pension scheme. Benefits tied to this scheme are tax exempt.

bixton:
A8: If registered as an enterprise (business name), you pay Personal Income Tax. If registered as a limited liability company, you pay Company Income Tax.


With regards to the bolded....

How is this personal income tax calculated for one who runs an Enterprise business name and also will the employees under this kind of business name required to also pay personal income tax?

Is that not double taxation because the Enterprise business first taxes the individual employees salary/wages and remit to the FG and why will the FG still go ahead to tax same employees?!!!!

Please explain with clarity.....
Thanks.

I honestly have no idea about how this is calculated too.

Will state governments still collect PAYE tax? Infact, will there be any tax paid to state governments anymore?

datola:
@ Q23

The turnover limit for small limited liability company for tax exemption is N100 millions according to Taiwo Oyedele.

I think it was changed from N50million to N100million

This is where the clarification on what was gazetted and what was passed, comes in.

So how will the govt now know my personal income in a year to determine how much am supposed to pay?

But Nigeria workers both in private and public federal government service were already paying tax known as PAYE

Their EMPLOYERS HAVE BEEN EXTRACTING THE INCOME TAX AT SOURCE all the while prior to this pronouncement

Are you saying that money that enters the government or the private sector hands after all the deductions including mortgage, pension, insurance and income tax is what you are now after?

If that's the case, then this is double jeopardy!
Double taxation!

Clap for your Tinubu..
We shall on election day

johngwain:
Lies, fcmb took #1,060 from me this morning from interest of money I had in my savings they tagged it tax

That's withholding tax of 10% on your interest of N10,060.

And yes the new tax laws will hit everyone rich or poor.

Mrexcell:
So how will the govt now know my personal income in a year to determine how much am supposed to pay?

Lol they expect you to declare.

WhizdomXX:
This is where the clarification on what was gazetted and what was passed, comes in.

The legistlatiffs should be fast about it!

All this too. Much explanations, we will know as soon as Implementation starts.

hatchy:
All the APC Voltrons have already positioned themselves to post and support this thread. Look at them up there and throughout the topic posting and applauding the wicked taxation.

"Reduce their purchasing power, spread the tax net"

Bola Tinubu, 2020

We have a generation of copy and paste....
A generation of say it as you are told......

Without actually having a clear understanding of it and also able to respond intelligently to questions when asked.......

So in their trying to make it known to the public they have also failed in passing the information around....

Image123:
You can't easily wake a man pretending to sleep. Most of the people don't want to understand it. They want it to fail, they want to use misinformation to see if it can fail, or if they can cause problems or riots with it. Poor man pikin dey middle dey fight for big man tax.

There is nothing they can do.

Every of their efforts to frustrate the government will all end in nought

By 2027, they will all realize the futility of their shenanigans


You can imagine the lambanus lienus fans, suddenly El-rufai is now a saint since he is in ADC

suddenly Amaechi is now a saint since he is in ADC

suddenly Aregbesola is now a saint since he is in ADC


suddenly Ariku is now a saint since he is in ADC


suddenly David Mark is now a saint since he is in ADC

Tinubu till 2031.