If you’re in Nigeria, you’ve definitely seen conversations online about Nigeria’s new tax reform, and that’s why you’re reading this article. From social media threads to WhatsApp broadcasts, there’s been a lot of noise. Some have been helpful, some confusing, and some outright wrong.
So let’s slow things down and break it all down properly.
On January 1, 2026, Nigeria started operating under a new tax reform bill which was signed into law on June 26, 2025. This tax reform bill consists of four separate acts. Together, they affect how individuals earn, declare, and pay taxes, especially for people who work remotely or earn income digitally through apps like Nosh.
This article explains what the new tax reform actually is, who it applies to, and other important things you need to know and understand.
The new tax reform is not a single rule or policy. It is a complete overhaul of Nigeria’s tax system, designed to make taxation clearer, fairer, and more efficient.
At the centre of the tax reform are four new laws:
For individuals, the most important changes are around personal income tax, digital income, and how records are kept.
It applies to:
It does not apply to:
The key thing to note is this: tax applies to income and profit, not money movement.
Having money in your account, whether in your Nosh wallet or your bank account, does not automatically mean tax is due or will be deducted from your funds.
Under the Nigeria Tax Act 2025, income tax is progressive, meaning higher income is taxed at higher rates, but only after deductions.
Here is a breakdown:
| Annual Personal Income | Tax Rate |
| ₦0 – ₦800,000 | 0% |
| ₦800,001 – ₦3,000,000 | 15% |
| ₦3,000,001 – ₦12,000,000 | 18% |
| ₦12,000,001 – ₦25,000,000 | 21% |
| ₦25,000,001 – ₦50,000,000 | 23% |
| ₦50,000,001 & above | 25% |
Note that these rates apply only after eligible deductions are removed.
One major improvement in the new tax system is clarity around deductions. These deductions reduce how much of your income is taxable.
You can deduct:
For example, if you earn ₦3 million annually but pay rent, contribute to pension, and have health insurance, you are to remove these amounts from your annual income or profit. After eligible deductions, your taxable income could be significantly lower than ₦3 million.
When it comes to crypto and gift cards, the tax treatment is different.
For crypto, any profit you make from trading may be considered taxable income under Nigeria’s personal income tax rules. However, if you incur losses, those losses can be used to offset future crypto gains. How much tax you owe, if any, depends on your total annual income and the applicable tax bracket. Importantly, tax is not charged automatically on each trade, it is something you assess and declare when filing your taxes.
Gift cards are treated differently. Casual or occasional gift card sales, such as selling a gift card you received for personal use, are generally not taxable. However, if gift card trading becomes a regular activity with high volume and consistent profit, it may be regarded as a business. In that case, the income could be subject to business tax rules.
Nigeria’s new tax laws also bring important changes for business owners, including small and large businesses. These changes aim to reduce pressure on smaller enterprises while still broadening the tax base for larger companies.
Here’s what you should know:
Small businesses with annual turnover up to ₦100 million and total fixed assets not more than ₦250 million are now exempt from Corporate Income Tax (CIT), Capital Gains Tax (CGT), and the newly introduced Development Levy. This means many smaller companies won’t pay company-level tax at all under the new rules.
Now, there are no “medium” sized companies. A business either exempt from paying tax (small) or fully liable to pay tax (standard).
For companies, profits from selling assets are no longer taxed separately as Capital Gains Tax, which was at the rate of 10%. Instead, all company profits, whether from normal business activities or asset sales, are combined and taxed once at 30% under Corporate Income Tax. This change closes loopholes and prevents companies from selling assets just to pay lower taxes.
With the new reform, large companies can no longer avoid paying their fair share of tax. Businesses with ₦50 billion or more in annual turnover, or multinational companies with over €750 million in global revenue, must pay at least 15% tax. If their total tax comes out lower than this, an extra charge is added to make up the difference.
Let’s address some of the biggest misconceptions and questions directly.
1. Will the government automatically debit my bank account or wallet?
No, the government does not automatically debit individual accounts, nor can they access private wallets.
Nigeria uses a self-declaration tax system. This means you report your income and pay taxes directly, rather than having funds taken without notice.
2. Will Nosh deduct tax from my transactions?
No, Nosh does not and cannot deduct any form of tax from your wallet. You are responsible for declaring and paying any applicable taxes yourself.
3. Is every transfer I send or receive taxable?
Not every transfer is taxable. Moving money between accounts is not considered income. Tax applies to profits and earnings, not to transfers.
4. Does adding narration to transfers exempt me from paying tax?
No, adding a narration does not exempt transactions from tax. Narrations are meant to help you track and understand your payments. They do not determine whether a transaction is taxable.
5. Does the new tax law affect cryptocurrency?
No, it doesn’t. Cryptocurrency remains legal. However, profits made from crypto trading are now clearly recognised as taxable income under personal income tax rules.
6. Are gift card sales taxed in Nigeria?
Casual gift card selling is not taxed. Occasionally selling gift cards you received as a gift is generally not taxable. Tax may apply only if gift card trading is carried out as a business with regular profits.
7. Is money sitting in my wallet or bank account taxable?
Holding money in your account is not taxable. Simply having funds in your Nosh wallet, any other wallet or bank account does not create a tax obligation. Tax applies when income is earned or profits are made.
Taxes are not paid daily or per transaction, neither is it deducted from your account balance.
Here’s how it works now:
This applies whether income comes from salary, freelance work, or digital assets.
To find your Tax Identification Number (TIN) under Nigeria’s new tax reform, first check if one has already been assigned to you.
For individuals, your National Identification Number (NIN) now serves as your TIN. For registered businesses, the Corporate Affairs Commission (CAC) registration number is used as the TIN.
To confirm your TIN as an individual:
You don’t need to become a tax expert. Just do the basics well.
Here’s a simple compliance checklist you can follow:
Nigeria’s new tax reform is to bring clarity, uniformity, and transparency, not chaos.
For individuals, the biggest takeaways are simple:
For businesses, the reform aims to encourage growth while improving compliance:
Ifeoluwa
When Ife isn't reading or writing content, she's laughing at a tweet or burning her data on Netflix. Working hard and playing hard. 😉
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