Nigeria Tax Act 2026: What Every Finance and Accounts Team Must Know Before June
If you manage finance, accounting, or payroll in a Nigerian company, the ground just shifted underneath you.
On June 26, 2025, President Bola Ahmed Tinubu signed four landmark tax reform bills into law — the most sweeping overhaul of Nigeria’s tax system in over three decades. These laws took full effect on January 1, 2026, and the window to get your team compliant is closing fast.
This guide breaks down exactly what changed, what it means for your finance and accounts team day-to-day, and what your organisation must do before the June 2026 filing deadlines arrive.
What Is the Nigeria Tax Act 2026?
The Nigeria Tax Act (NTA) 2025 — now in effect as of January 1, 2026 — consolidates over a dozen previously fragmented federal tax laws into a single unified legislation. The four acts signed into law are:
- The Nigeria Tax Act (NTA) replaces CITA, PITA, CGTA, VAT Act, and Stamp Duties Act
- The Nigeria Tax Administration Act (NTAA) — new compliance and enforcement framework
- The Nigeria Revenue Service Act (NRSA) — replaces the FIRS Establishment Act
- The Joint Revenue Board Act (JRBA) — coordinates federal and state tax collection
For finance and accounts teams, this is not a minor update. This is a complete restructuring of how tax is assessed, reported, and paid in Nigeria. If your team is still operating under the old CITA and PITA frameworks, they are already non-compliant.
10 Critical Changes Your Finance Team Must Understand Now
1. Company Classification Has Changed — Small vs Large Only
The old three-tier system (small, medium, large) is gone. Under the NTA, companies are now classified as either small or large:
- Small company: Annual gross turnover up to ₦100 million AND fixed assets below ₦250 million
- Large company: Everything else
This matters enormously for your tax obligations. Small companies are now fully exempt from Companies Income Tax (CIT), Capital Gains Tax (CGT), and the new Development Levy. If your company now qualifies as small under the new definition, you may owe significantly less than you did last year — but only if your accounts team files correctly under the new classification.
2. Companies Income Tax Rate Has Dropped for Large Companies
Large companies now pay CIT at 25% from the 2026 year of assessment, down from 30% previously. The 2025 rate was 27.5% as a transitional step. Your finance team needs to update all tax provision calculations and forecasts immediately.
3. A Brand New Development Levy — 4% on Assessable Profits
This is entirely new and catches many companies off guard. All large companies must now pay a 4% Development Levy on assessable profits. This levy consolidates the old Tertiary Education Tax (TET), IT Levy, NASENI levy, and Police Trust Fund levy into one charge. If your team is still budgeting for these levies separately, your projections are wrong.
4. Personal Income Tax Bands Have Been Completely Restructured
This affects every payroll officer and HR manager in Nigeria. The NTA introduces a new progressive personal income tax structure:
- First ₦800,000 of annual income: 0% — completely tax-free
- Income above ₦800,000: taxed on progressive bands from 15% to 25%
The old Consolidated Relief Allowance (CRA) has been eliminated and replaced with a new rent relief of 20% of annual rent paid, capped at ₦500,000. Every payroll calculation your team runs must reflect these new bands. If you have not updated your payroll software and calculations, you are either over-deducting or under-deducting PAYE from your employees right now.
5. Capital Gains Tax Is Now Merged With Income Tax
The flat 10% Capital Gains Tax rate is abolished. Capital gains are now included in taxable income and taxed at the applicable income tax rate. Additionally, gains realised in 2025 must be included in the 2026 year of assessment — meaning they are taxable now even though they occurred last year. This affects any company that disposed of assets in 2025.
6. Full Capital Allowance Claims — No More Two-Thirds Limitation
Under the old CITA, companies could only claim two-thirds (66.67%) of capital allowances in any given year. The NTA abolishes this restriction. Companies can now claim full capital allowances without limitation. This is a significant benefit that your finance team should factor into your 2026 tax planning immediately.
7. VAT Has Changed — Input VAT Rules Are Stricter
The NTA introduces tighter rules around VAT input claims. Businesses can only claim input VAT incurred in making taxable supplies. If your business has a mix of taxable and exempt supplies, your VAT recovery calculation must be reviewed. Your accounts team needs to know exactly which of your supplies are taxable, zero-rated, or exempt under the new definitions.
8. New Penalties for Non-Compliance — Much Steeper Than Before
The NTAA has significantly increased administrative penalties. Failing to file returns or filing incomplete returns now attracts:
- ₦100,000 for the first month of non-compliance (previously ₦25,000)
- ₦50,000 for each subsequent month (previously ₦5,000)
This is a four-to-ten times increase in penalties. A finance team that misses a filing deadline under the old regime might have faced minimal consequences. Under the NTA, the penalties accumulate rapidly. Compliance is no longer optional — it is financially critical.
9. Transfer Pricing and Multinational Rules Are Tightened
Nigerian companies that are part of multinational groups with aggregate group turnover of EUR 750 million and above, or annual turnover of ₦50 billion and above, are now subject to a minimum effective tax rate (ETR) of 15%. The NTA also introduces Capital Gains Tax on indirect transfers of shares in Nigerian companies — previously a loophole used by offshore holding structures.
10. New Definition of Tax Residency Affects Expatriates
The NTA introduces a clearer definition of tax resident and non-resident individuals. This directly affects companies with expatriate employees. If you have foreign nationals working in Nigeria or Nigerians working abroad, your payroll and tax treatment may need to change.
What This Means for Your Finance Team Day-to-Day
The practical implications for your accounts department are significant and immediate:
Payroll must be recalculated. Every employee’s monthly PAYE deduction needs to be recomputed using the new income bands and the new ₦800,000 tax-free threshold. Employees earning below ₦800,000 annually should have zero PAYE deducted from their salary. If they were previously paying tax on that income, you need to correct this now.
Tax provisions need updating. Your 2026 corporate tax provision should reflect the new 25% CIT rate, the 4% Development Levy, and the full capital allowance benefit. Any company still provisioning at 30% is overstating its tax liability and understating its profit.
VAT returns need review. The new input VAT rules require a careful review of your VAT recovery position. This is especially important for companies in sectors with a mix of standard-rated and exempt activities.
Filing deadlines are unchanged but penalties are not. Companies with December year-ends must file their 2025 returns (which fall under the new NTA framework for the 2026 year of assessment) by the standard deadlines. Missing these deadlines now costs significantly more than before.
Why Your Team Needs Formal Training — Not Just a Memo
Here is the reality that many Nigerian finance directors are discovering right now: circulating a memo about the new tax law is not enough.
The NTA represents the most comprehensive restructuring of Nigerian tax law since the 1990s. The changes affect not just what your company pays but how your team calculates, records, reconciles, and reports every single tax transaction. A finance officer who learned Nigerian tax practice under the old CITA and PITA framework — and that is most of the finance professionals currently working in Nigerian companies — has knowledge that is now partially outdated.
The risk is not just financial penalties. It is reputational risk, audit exposure, and the very real possibility of inadvertent non-compliance simply because your team did not know the rules had changed.
TomFlims: Nigeria’s Leading ITF-Accredited Tax Training Provider
This is exactly why TomFlims has developed a comprehensive suite of Nigeria Tax Act training programmes specifically designed for finance and accounts teams, HR professionals, and business leaders.
TomFlims is fully accredited by the Industrial Training Fund (ITF), the Centre for Management Development (CMD), AAPM, and IOSCM. With over a decade of experience training professionals at Nigeria’s most respected organisations — including CBN, Nigeria LNG, Cadbury Nigeria, Zenith Bank, and Access Bank — TomFlims brings real Nigerian business context to every programme.
Our Nigeria Tax Act 2026 Training Programmes
Programme 1 — Navigating Nigeria’s New Tax Law: A Guide for Accounts and Finance Teams A comprehensive 2-day programme covering all ten major changes in the NTA, practical implications for your company’s tax calculations, and hands-on workshops using real Nigerian company scenarios. Ideal for financial controllers, senior accountants, and finance managers.
Programme 2 — Sales Team Essentials: Decoding Nigeria’s Tax Law A focused 1-day programme for sales directors, commercial managers, and business development teams who need to understand how the new tax environment affects pricing, contracts, and customer negotiations.
Programme 3 — Stay Ahead: Emerging Trends in Nigeria’s New Tax Laws A strategic half-day briefing for CEOs, MDs, CFOs, and board members who need to understand the commercial and strategic implications of the NTA without the technical detail. Delivered in-house on request.
Programme 4 — HR and Payroll Compliance Under the Nigeria Tax Act A targeted 1-day programme for HR managers and payroll officers covering the new PAYE bands, rent relief, expatriate tax treatment, and how to update payroll systems to comply with the NTA from January 2026.
How to Fund This Training Through the ITF
One of the most important things Nigerian companies overlook is that training your team on the new tax law may cost your organisation nothing net.
As an ITF-accredited training provider, TomFlims qualifies for the Industrial Training Fund’s employer reimbursement scheme. Companies that have paid their annual ITF levy — the mandatory 1% of total payroll for companies with 25 or more employees — can claim back up to 50% of qualifying training costs when they train with an ITF-accredited provider like TomFlims.
This means a company that spends ₦500,000 training its finance team with TomFlims could recover ₦250,000 from the ITF. The net cost of being compliant with the most significant tax reform in a generation could be half what you think.
Contact TomFlims and we will provide you with the complete ITF documentation checklist to process your reimbursement claim.
The June 2026 Deadline — Why the Urgency Is Real
Finance and accounts teams across Nigeria are working against a real calendar right now.
Companies with December year-ends face their first NTA-framework corporate tax filing in mid-2026. Companies with mid-year year-ends may face filings even sooner. The new penalty regime means that errors or late filings are significantly more expensive than they used to be.
Every week that passes without your team being fully trained on the new framework is another week of exposure — wrong payroll deductions accumulating, incorrect tax provisions building up, VAT recovery positions going unreviewed.
The companies that get their teams trained in March, April, and May 2026 will file accurately and on time. The companies that wait until June will be scrambling.
What Past TomFlims Participants Say
“I gained more experience than I expected. With seminars like this, the sky is our limit.” — Aiyeotan Olaitan Ayodele, Access Bank PLC
“This training has impacted a lot on my strength. I advise that a training like this should come up more regularly — kudos to the TomFlims crew.” — Adefolarin Eniola, Cadbury PLC
“This is a wonderful training that is beyond my expectation. It impacted more knowledge on me.” — Raheem Kazeem Adewale, Vita Foam Ltd
Frequently Asked Questions
When did the Nigeria Tax Act 2026 take effect?
The four Tax Reform Acts were signed into law on June 26, 2025 and took full effect on January 1, 2026. All companies are required to comply with the new framework from January 1, 2026 onwards.
Does the new tax law affect small businesses in Nigeria?
Yes and no. Small companies — those with annual turnover below ₦100 million and fixed assets below ₦250 million — are actually better off under the NTA. They are now fully exempt from CIT, CGT, and the Development Levy. However, they still need to understand the new PAYE rules, VAT framework, and compliance requirements.
What happens if my company files under the old tax framework by mistake?
This is a serious compliance risk. Filing under the wrong framework could result in incorrect tax payments, penalties under the NTAA, and potential audit exposure. Getting your finance team trained now is the most cost-effective way to avoid this.
How is the new Development Levy calculated?
The Development Levy is 4% of your company’s assessable profits — that is, your taxable profits before deducting capital allowances and losses. It replaces the old TET, IT Levy, NASENI levy, and Police Trust Fund levy. It applies to all large companies and is due at the same time as your CIT filing.
Can TomFlims train our whole finance team at our office?
Absolutely. In-house training is our most popular option for corporate finance teams. We bring our expert facilitators to your premises and deliver the programme tailored entirely to your company, your industry, and your specific tax positions. We operate from Lagos (Surulere, Lekki, Magodo) and Abuja, and we travel to client sites anywhere in Nigeria.
Is TomFlims training eligible for ITF reimbursement?
Yes. TomFlims is fully accredited by the Industrial Training Fund (ITF). Your organisation can claim back up to 50% of qualifying training costs through the ITF reimbursement scheme. Contact us for the full documentation checklist.
Book Your Team’s Nigeria Tax Act Training Today
The Nigeria Tax Act 2026 is not coming — it is already here, and your team is either compliant or it is not.
TomFlims has trained hundreds of finance professionals at Nigeria’s leading companies. Our Nigeria Tax Act programmes are designed specifically for the Nigerian business environment, delivered by facilitators who understand how these laws work in practice — not just in theory.
Do not wait until June to discover your payroll has been wrong since January.
Call us today: 014700398 or +2348032905352 WhatsApp: +2348032905352 Email: [email protected] Request an in-house proposal: tomflims.com/contact
Training locations: Surulere Lagos · Lekki Lagos · Magodo Lagos · Abuja
