Nigeria: Income Tax

Nigeria's Federal Ministry of Finance has issued General Transition Guidelines to support the implementation of four landmark tax statutes signed into law in June 2025, establishing a unified modern tax framework.

Nigeria's new Presumptive Tax Regulations establish a simplified tax framework for informal sector businesses and individuals whose income cannot be accurately determined through standard assessment methods. The regulations introduce a 1% turnover-based tax system with specific exemptions for nano businesses, while also implementing a 2% capital gains tax on asset disposals.

On 18 June 2026, Nigeria's Minister of Finance issued comprehensive transition guidelines for newly enacted tax legislation. These guidelines establish operational frameworks for implementing four major tax Acts that fundamentally reshape the country's tax administration and revenue collection systems. The transition rules address critical implementation questions for taxpayers, tax authorities, and stakeholders navigating Nigeria's reformed tax landscape.

The decision of the Federal High Court ("the Court") in Shell Petroleum Development Company of Nigeria Limited v. Federal Inland Revenue Service (FIRS)1 has brought renewed attention to fundamental principles of Nigerian tax law, particularly regarding the proration of tax rates within an accounting year and the retrospective application of tax legislation.

You may have heard about the new tax reform Acts passed by the National Assembly and signed into law by His Excellency, President Bola Ahmed Tinubu GCFR, in June 2025. These reforms come in four key pieces of legislation: the Nigeria Tax Act, the Nigeria Tax Administration Act, the Joint Revenue Board of Nigeria (Establishment) Act, and the Nigeria Revenue Service (Establishment) Act. Taken together, these pieces of legislation represent the most significant overhaul of Nigeria's tax framework in decades

Management fees are a common feature of intra-group arrangements within multinational enterprises (MNEs), reflecting charges for services provided by a parent company or related entity to its subsidiaries. These services are typically designed to promote operational efficiency, ensure consistency in group-wide policies, and allow group entities to benefit from centralized expertise.

In a significant overhaul of the Nigerian tax framework, the Nigeria Tax Act, 2025 ("NTA" or "the Act"), among other pieces of legislation, were signed into law by the President of the Federal Republic of Nigeria on 26 June 2025.

As implementation of Nigeria's Tax Reform Acts 2025 (namely The Nigeria Tax Administration Act 2025, The Nigeria Revenue Service Act 2025 and the Joint Revenue Board of Nigeria Act 2025...

For many Nigerians, moving abroad meant a clean break from Nigerian tax obligations.