Quick summary: What happened and when it matters
On 26 June 2025 the President assented to four reform Bills, now consolidated into the Nigeria Tax Act, 2025. Most provisions start on 1 January 2026, giving taxpayers roughly five months to get their books, contracts and payroll ready. Transitional rules apply where an accounting period straddles 2025/2026. For full legislation details, see our Nigeria Tax Act, 2025 guide.
This guide serves:
- Salary earners who want to know whether their take-home pay changes.
- Owners of micro and small businesses in Aba or Katsina who struggle with multiple levies.
- Finance teams in banks, oil majors and tech start-ups looking at transfer-pricing files.
Top 12 changes you need to know
| # | Change | Impact tag |
|---|---|---|
| 1 | Unified tax code, over 15 earlier laws merged, reducing overlaps | ✅ Less confusion |
| 2 | New individual tax bands: 0 % on first ₦800,000, rising to 25 % above ₦50 m (Fourth Schedule, Section 58) | 💸 Possible higher PAYE for high earners |
| 3 | Company rate clarified: 0 % for small firms, 30 % for others (Section 56) | 📈 Budget planning |
| 4 | Minimum 15 % effective tax for large multinationals (Section 57) | 🌍 Pillar-2 like rule |
| 5 | VAT continues at 7.5 %but tighter digital rules (Section 148) | 🛒 E-commerce compliance |
| 6 | Non-resident suppliers must register (Section 151) | 🌐 Cross-border |
| 7 | Self-accounting VAT directive where suppliers omit tax (Section 155(2)) | 📝 Extra bookkeeping |
| 8 | Withholding & remittance due by 14th of following month (Section 155) | ⏰ Tighter deadlines |
| 9 | New Development Levy of 4 % on assessable profits, excluding small companies (Section 59) | 🏗️ Funding education & tech |
| 10 | Significant Economic Presence definition expanded to streaming, cloud, adverts (Section 14(b)) | ☁️ Digital taxes |
| 11 | Transfer-pricing and BEPS style documentation mandatory for groups > ₦20bn turnover (Section 57(2)) | 📂 File early |
| 12 | Sector incentives recast, priority sectors list now in Chapter Eight Sections 163-168 | 🌱 Targeted relief |
For an overview of all major new laws, visit Nigerian Tax Laws 2025.
Who is affected and how?
Example 1, Salaried employee
Under the new Fourth Schedule a mid-level engineer in Lagos saves a small amount because the first ₦800k is now zero-rated. To estimate personal impact, use our free Nigerian Tax Calculator.
Example 2, SME (turnover ₦90 m, profit ₦18 m)
| 2025 | 2026 | |
|---|---|---|
| Company income tax | ₦5.4m (30 %) | ₦5.4 m |
| Development levy | 0 | ₦216,000 (4%) |
| Total | ₦5.4 m | ₦6.12 m |
Cash flow planning becomes important.
Example 3, Multinational (turnover ₦30 bn, ETR 10 %)
Needs to compute top-up tax to reach 15 % under Section 57. For a profit of ₦6 bn, additional ₦300 m tax is due.
Immediate compliance actions, ten steps before 1 Jan 2026
- Review payroll tables against the new bands.
- Patch accounting software for new levy fields and self-accounting VAT codes.
- Amend supplier contracts to shift VAT wording.
- Confirm VAT and TIN status for digital platforms.
- Update tax forecasts to reflect the 4% levy.
- Train HR and finance staff on monthly remittance deadlines.
- Prepare transfer-pricing master file (groups above ₦20 bn).
- Check industry-specific reliefs in Chapter Eight.
- Organise document rooms for faster NRS audits.
- Download our printable checklist (CTA).
For expert assistance, browse our directory of Nigerian tax professionals.
Sector-by-sector impact at a glance
| Sector | Key change | Action |
|---|---|---|
| Oil & gas | Hydrocarbon tax rules moved to Chapter Three | Re-work modelling sheets |
| Banking | 15 % minimum ETR may bite | Review offshore SPVs |
| Tech & fintech | Digital services now have clear VAT & SEP rules | Register platform, collect VAT |
| Manufacturing | Priority sector certificate can reduce rate | Apply under Section 166 |
| Agribusiness | Many incentives retained | Keep evidence of export proceeds |
Practical resources and links
- Official text: Nigeria Tax Act PDF, https://mytax.com.ng/tax-laws/nigeria-tax-act
- FIRS e-filing portal, https://www.firs.gov.ng
- PwC Nigeria, 2025 Tax Reform summary (link available on pwc.com/ng)
- KPMG Insight: “Nigeria ushers in new unified tax code” (search kpmg.com/ng for verified PDF).
- Downloadables: readiness checklist, salary impact calculator.
- For the latest updates, see our Nigerian Tax Insights Blog.
Next steps & 30 / 60 / 90-day checklist
| Day range | Individual focus | Business focus |
|---|---|---|
| 0-30 | Gather payslips, run calculator | Map all tax touch-points, brief C-suite |
| 31-60 | Confirm TIN and bank details | Patch ERP, amend contracts |
| 61-90 | Cross-check first test run | Dry-run January VAT and WHT filings |
Conclusion: Looking toward 2026
Change is certain, confusion is optional. By updating systems early, keeping records tidy and seeking advice where needed, you can step into 2026 with confidence.