Nigeria’s new Tax Administration Act mandates Tax IDs for financial and business activities, aiming to simplify compliance and close revenue loopholes.
Nigeria’s new Tax Administration Act (NTAA) has introduced fresh attention to a long-standing requirement: the use of Tax Identification Numbers (Tax IDs) for financial and business transactions. The move, designed to strengthen compliance and transparency, has raised questions among individuals and businesses across the country.
Under the NTAA, all taxable persons—those earning income through trade, employment, or business—must register with the tax authorities and obtain a Tax ID. Banks and other financial institutions are required to request this number when opening or maintaining accounts linked to taxable income. However, individuals who do not earn income are not required to obtain one.
While many Nigerians believe this is a new rule, the policy has existed since the Finance Act of 2019, which amended the Personal Income Tax Act. Since January 2020, individuals opening business accounts have been required to provide a Tax Identification Number (TIN). The NTAA now consolidates and harmonizes these existing obligations under a single framework.
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The term “Tax ID” replaces the older “TIN” to unify identifiers issued by the Federal Inland Revenue Service (FIRS), Joint Tax Board (JTB), and State Internal Revenue Services. In practice, an individual’s National Identification Number (NIN) or a company’s Corporate Affairs Commission (CAC) registration number will serve as the new Tax ID.
For those already holding a TIN, no new registration is needed. The Tax ID can be obtained free of charge either online or at FIRS, State IRS, or JTB offices—without the need for biometric capture or a physical card. Authorities have warned the public to avoid unofficial agents or touts offering registration services.
The requirement also extends to businesses and government entities. Companies and non-governmental organizations will automatically receive Tax IDs through their CAC registrations. Ministries, departments, and agencies at all levels are also mandated to register. Nigerians in the diaspora can use their NIN to obtain a Tax ID for banking or investment activities in the country, while foreign companies operating in Nigeria must comply if they provide goods or services locally.
From January 2026, taxable persons without a Tax ID may face restrictions on banking, insurance, and investment activities, alongside legal penalties.
Officials say the measure aims to simplify identification, curb tax evasion, and create a fairer tax system—ensuring that only those who earn taxable income contribute, while protecting low-income citizens from unnecessary burdens.
