The Nigeria Presumptive Tax Regulations, 2026 (“the Regulations”), issued pursuant to Section 29 of the Nigeria Tax Act (NTA or “the Act”), 2025, establishes a simplified framework for taxing persons whose income cannot be reliably determined due to inadequate records or the withholding or misrepresentation of relevant information. The Regulations, which became effective 1 January 2026, prescribe compliance requirements for taxpayer registration, filing, electronic payment, objections and enforcement.
The framework introduces a presumptive income tax of 1% of actual or estimated turnover, and a 2% presumptive tax on the gross consideration from asset disposals. The turnover-based approach is intended to improve compliance within the informal economy. The Regulations may also have broader commercial implications. The simplified framework may encourage greater formalisation by providing a structured compliance regime for taxpayers operating outside the formal tax system.
The Regulations may also support improved taxpayer registration, broaden the tax base and enhance tax administration where income cannot readily be determined using conventional record-keeping.
Informal businesses that exceed the ₦12 million threshold may experience an increase in their tax obligations compared to the tax liability that may be payable under the self-assessment regime. This may, therefore, encourage them to keep proper books of accounts to facilitate the proper determination of their tax liability. Businesses should therefore assess the potential impact of the Regulations, particularly where they engage informal vendors, distributors, agents or other service providers, and where they are required to register under the self-assessment regime.
