Nigeria: Presumptive tax regulations for taxpayers with unreliable income records
Effective January 1, 2026
The Minister of Finance and Coordinating Minister of the Economy has issued the Presumptive Tax Regulations, 2026, establishing a simplified framework for taxing persons with income that cannot be reliably determined due to inadequate records or the withholding or misrepresentation of relevant information. The regulations, which became effective January 1, 2026, were introduced to address historical challenges in taxing Nigeria's informal sector, and the regime is intended to improve tax compliance within the informal economy while reducing administrative burdens for both taxpayers and tax authorities.
- The standard presumptive tax rate is 1% of actual or estimated turnover, and when only daily turnover can reasonably be estimated, the annual turnover will be calculated by multiplying the estimated daily turnover by 300 days.
- Taxpayers must also pay a presumptive tax on chargeable gains at the rate of 2% of the gross consideration received on a chargeable transaction, payable within 30 days after the transaction is concluded or upon receipt of consideration, whichever occurs first.
- Nano businesses with an annual turnover not exceeding NG₦12 million, no fixed premises, and no employees are exempt from the regime, as are specified businesses and persons exempt under Section 162 of the Nigeria Tax Act (NTA).
Administration of the regime rests with the relevant tax authorities, including the Nigeria Revenue Service (NRS), depending on the taxpayer's residence. Taxpayers may object to assessments within 30 days of receipt or transition to the self-assessment regime by maintaining adequate records.
Read a July 2026 report prepared by the KPMG member firm in Nigeria