Nigeria Tax Act, 2025 has been signed – highlights
- VAT Invoicing Requirements: VAT invoices in Nigeria must include a business registration number and sequential numbering, with a mandatory fiscalization system and real-time e-invoicing validation through the Merchant Buyer Solution (MBS).
- VAT Registration and Collection: Nonresident persons (NRPs) supplying taxable goods/services in Nigeria must register for VAT and withhold VAT, while digital platforms collecting commissions are required to charge VAT on the total supply value. VAT paid on imports via online platforms is exempt from additional VAT during customs clearance if proof of payment is provided.
- Changes in Exemptions and Input VAT Claims: Humanitarian goods are now VAT-exempt, while exports are zero-rated, allowing full input VAT recovery on zero-rated supplies such as basic foods and medical products. Registered taxpayers can claim input VAT on taxable supplies within five years, and refunds for excess input VAT must be claimed within 12 months, with penalties for false claims.
Source EY
- Proposed legislation aims to reform Nigeria’s tax system
- Nigeria historically relies on oil revenues
- Fluctuating global oil prices create challenges
- Need for diversified and sustainable income stream
- NTAA designed to modernize tax collection processes
- Enhances compliance and optimizes revenue
- Promotes accountability within the tax system
- Key provisions include unified tax administration structure
- Mandatory tax identification registration required
- Expanded tax base and monthly return requirements
- Digitalization of tax filing through electronic fiscal system
- Introduces penalties for non-compliance
- Mandates disclosure of tax planning strategies
Source: kpmg.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
