₦airaland Forum

For anyone finding this now — the law changed since this thread, so most of the answers above no longer apply.

The Nigeria Tax Act 2025 and the Nigeria Tax Administration Act 2025 took effect on 1 January 2026, and FIRS is now the Nigeria Revenue Service. Here's where it stands.

1. VAT is not the same thing. Paying VAT on things you buy doesn't discharge personal income tax. They're separate taxes on separate things — one on your spending, one on your earnings. Paying the first doesn't settle the second.

2. Freelance platforms do not pay your Nigerian tax. Upwork, Fiverr and the rest don't remit anything to Nigeria on your behalf. If you're resident here, the tax on that income is yours to declare. This is the assumption that costs people the most, because you can hold it for years without finding out.

3. Naira, at the official rate, on the day you were paid. The original poster asked this twice and it's the part people get wrong. Not the parallel rate. Not today's rate. Not one average for the whole year — convert each payment separately using the official rate for the date that payment landed. In a year where the naira moves a lot, that's a materially different figure, and it's the one you can actually support if asked. Keep the date, the original amount, and where you got the rate.

4. You're taxed on profit, not turnover. Subtract the real costs of earning it — data, software you need for the work, platform fees, the business share of your equipment. Keep receipts; an undocumented deduction can be disallowed.

5. The rates. First ₦800,000 of taxable income is 0%, then 15%, 18%, 21%, 23% and 25% above ₦50 million. It's banded — only the slice inside each band is taxed at that rate, so earning more never leaves you worse off.

6. The Consolidated Relief Allowance is gone. If a guide or calculator still applies CRA, it's working from the old law and will show you too low a number. The main personal relief now is rent relief — 20% of your annual rent, capped at ₦500,000, with proof of payment.

7. Get a Tax ID. It's required, and there's a direct cost to skipping it: when a Nigerian company pays you for professional work it must withhold 5% — but 10% if you have no Tax ID. That's your money, gone at double, and you can only claim it back by filing.

8. Where it goes. Personal income tax is administered by your State Internal Revenue Service, based on where you live — not where your clients are. Filing is annual, by 31 March for the year before.

Everyone with taxable income files now, including a nil return if you owe nothing.