Freelancers, SMEs & States: Get Ready for Nigeria’s Tax Makeover
The Big Picture
Nigeria’s sweeping Nigeria Tax Act 2025 (NTA) is more than a policy tweak,it’s a top-to-bottom overhaul designed to drag the tax system into the digital age and away from oil-dependency. From January 2026, the Federal Inland Revenue Service (FIRS) says the maze of overlapping levies will shrink to a single, clearer route, promising what one official called “the end of multiple federal taxes,” Arise TV reports.
The Details
- One-Stop Shop for Companies. FIRS will harmonise returns so businesses file once a year instead of juggling separate forms. States are being nudged to sign on and kill duplicate levies, according to Small Business Insights.
- Freelancers & Remote Workers. The NTA broadens the tax net to cover global income once an individual meets Nigeria’s new residency tests,183 days in-country or significant economic ties. But income below ₦800,000 a year stays tax-free, Techpoint Africa notes.
- Diaspora Relief. Worried about double dipping? Relax. Foreign wages earned by non-residents remain untouched unless sourced from Nigeria, while personal remittances are exempt, the Finance Ministry clarified to New Telegraph.
- State-Level Spin-Offs. Jigawa’s Governor Umar Namadi just set up a committee to localise the federal reform, aiming for “a fairer, more efficient system,” TVC News says. Expect other states to follow.
Why It Matters
The reaction was swift: tax pros cheer the promise of fewer forms, while freelancers fret over the residency rules. “Clarity is great, but enforcement will be the real test,” one Lagos-based accountant told The Nation’s overview of the reform drive (The Nation). For SMEs juggling up to 50 different levies, a single return could be the difference between survival and shutdown.
Around the Tax World
- Jigawa goes first. The Namadi committee has 60 days to draft a state-level bill mirroring the NTA (TVC News).
- SME lifeline. FIRS hints at an online portal that pre-populates returns for small firms, cutting prep time by half (Arise TV).
- Global income rulebook. Techpoint Africa lists six common freelancer earnings,YouTube payouts, Upwork gigs, Substack revenue,that will now be reportable if you’re resident.
- Double-Tax Treaties. New Telegraph says Nigeria is negotiating fresh agreements with Canada, the UAE, and Kenya to shield diaspora income.
Tax Stat of the Day
₦800,000: the annual income threshold below which individuals owe zero personal income tax under the NTA (Techpoint Africa).
Looking Ahead
All eyes are now on the January 2026 launch date,and whether states sign up in time to make one-return filing truly nationwide.
Prepared by MyTax - mytax.com.ng