Let’s be honest: when most small business owners hear “tax,” their brain goes straight to headache, paperwork, or what exactly does the government even do for me? Whatever you think, the rules just changed big time.
In 2025, Nigeria passed its biggest tax overhaul in decades. These reforms bring structure, visibility, and clearer rules. Whether you’re running a bakery in Ikeja, selling fashion on Instagram, or building a fintech startup with global clients, the spotlight is now on you.
At Sciart Finance, we help businesses borrow smart, invest wisely, and stay compliant. So, here’s your plain-English breakdown of what these new tax laws actually mean for you.
What happened?
Four sweeping laws were signed into law to define this new tax era:
- Nigeria Tax Act: A unified code merging VAT, Personal Income Tax, and Capital Gains Tax.
- Nigeria Tax Administration Act: This is the rulebook sets out how tax is assessed, filed, and enforced.
- Nigeria Revenue Service Act: Remember when ‘NEPA’ became ‘PHCN’? Same here, bye bye ‘FIRS’, hello ‘NRS’.
- Joint Revenue Board Act: Aligns federal, state, and local tax systems for seamless coordination.
Together, these laws change the game and if you’re in business, you have no choice but to play, understanding them determines how well you play.
TIN: Now mandatory, No Exceptions
Just starting out? Not making profit? Still “testing the waters”? Doesn’t matter; you NEED a Tax Identification Number (TIN). Without it, you cannot:
- File taxes
- Open a business account
- Hire people formally
- Apply for contracts
Tax Brackets have been redefined- Know yours.
The law now clearly differentiates between micro, small, and big businesses. Your tax obligations depend on what bracket you fall into:
| Category | Annual Turnover | CIT Rate | VAT Filing | Tax Audit | Key Notes |
| Micro Enterprise | < ₦25 million | 0% | Not required | Not applicable | Exempt from most federal taxes |
| Small Enterprise | ₦25m – ₦100 million | 20% (2025) * | Required | Discretionary | Simplified tax compliance applies |
| Medium/Large Co. | > ₦100 million | 27.5% (2025) ** 25% from 2026 | Required | Mandatory | Full compliance required |
**Subject to top-up tax if Effective Tax Rate <15%
Regardless of whether you are micro, small or big business, you must still register and file returns- even if you owe no tax. Silence equals penalty.
Do you operate in a Priority Sector? You may pay zero tax.
If you operate in designated “priority” industry, you could qualify for the Pioneer Status Incentive (PSI): 3–5 years of zero corporate tax.
Eligible sectors include:
- Food processing & animal feed
- Renewable energy (solar, battery, off-grid)
- Software & tech infrastructure
- Medical diagnostics & devices
- Creative industries (animation, content studios)
- Solid minerals (e.g. lithium, marble)
- Data centres & cloud platforms
PSI status isn’t automatic, you will need to apply and meet specific thresholds. Apply through the Nigerian Investment Promotion Commission (NIPC)
This does not concern me, I have zero income. You must still file.
Even with zero revenue, you must file returns. Penalties include:
- ₦50,000 for not registering
- ₦100,000 for not filing (plus ₦50,000/month of delay)
Tax compliance isn’t optional anymore.
Selling Online or Earning Crypto? You’re in the Net
Freelancers, online sellers, and crypto traders are not invisible anymore.
- Virtual Asset Service Providers (VASPs) must now report transactions monthly.
- Payments via USDT, PayPal, or Bitcoin etc. are not exempt.
- If you sell on WhatsApp, Instagram, Jiji, etc you count.
You Can Now Appeal a Tax Decision (and You Should)
Disagree with your tax bill? Think you were treated unfairly?
- You can object but you must do so within 30 days.
- If unresolved, you may escalate to the Tax Appeal Tribunal.
- And if mistreated, you may report to the Tax Ombud.
You have a voice. Use it quickly.
What You Should Do Right Now
✅ Register your business and get your TIN
📥 Know your turnover bracket and what applies to you
🧾 File your returns (even if they’re zero)
💼 Check if your industry is PSI-eligible
💬 Consult a tax adviser or accountant
Final Word
At Sciart Finance, we believe compliance should not feel like punishment; it should be your platform into better finding, contracts and legitimacy. These new laws may feel tough, but they also mean the rules are clearer, the field is more level, and small businesses finally have a path to grow legitimately.
We’re here to help you navigate that path.
Need a free SME tax checklist or PSI eligibility guide? Drop us your email here we’ll send it over. No spam. No stress.
