List of Penalties, Fines and Jail Time for Offenders in Nigeria Tax Law Starting January 1, 2026

• The Nigerian Tax Act 2026, effective January 1, 2026, aims to boost equity, support workers, and improve infrastructure
• Strict penalties include fines up to N10 million and imprisonment for serious offences
• Offences cover non-registration, tax evasion, obstruction, and fraud, strengthening tax enforcement nationwide

Legit.ng journalist Dave Ibemere has over a decade of experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends

From January 1, 2026, failing to comply with Nigeria’s new tax law could attract heavy fines and imprisonment of up to 10 years.

Signed by President Bola Tinubu on June 26, 2025, the law is designed to strengthen compliance, boost revenue collection, and modernise the country’s tax administration.

To ensure effective enforcement, the Act introduces clear guidelines and stringent penalties for non-compliance, with fines of up to N10 million and imprisonment for serious offences, including assaulting a tax officer.

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Key offences and penalties include:

Failure to register and file returns

• Failure to register: N50,000 for the first month, N25,000 for each subsequent month.
• Failure to file VAT returns: N100,000 for the first month, N50,000 thereafter.
• Failure to keep proper books (companies): N50,000.

Technology and fiscalisation compliance

• Denying access for technology deployment: N1,000,000 on the first day, N10,000 for each subsequent day.
• Failure to use the fiscalisation system: N200,000 plus 100% of tax due and interest at the prevailing CBN rate.

Tax deduction and remittance failures

• Failure to deduct tax: 40% of the amount not deducted.
• Failure to remit deducted tax or self-account: full amount owed, 10% annual administrative penalty, plus interest at the CBN monetary policy rate.
• Serious cases may lead to imprisonment up to three years, fines not less than the principal tax due, plus up to 50% additional penalty, or both.

Ignoring notices or requests

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• Failure to respond to demands, notices, or provide records: N100,000 for the first day, N10,000 per subsequent day.
• Non-compliance with circulars, guidelines, or regulations: N1,000,000 for the first day, N10,000 daily thereafter.

Stamp duty and related offences

• Failure to stamp instruments: 10% of unpaid duty plus interest.
• Failure to disclose facts in dutiable instruments: N100,000 or N50,000, or imprisonment up to three years.
• Failure to notify change of address: N100,000 for the first month, N5,000 for subsequent months.

Fraud, impersonation, and assault

• Fraud relating to stamps: imprisonment up to three years, fine of at least N2,000,000, or both.
• Offences by authorised or unauthorised persons: fine of 200% of the sum involved or imprisonment up to three years, or both.
• Impersonation of a tax officer or aiding and abetting offences: fines up to N1,000,000 or imprisonment up to three years, or both.
• Obstruction of tax officers: administrative penalty of N1,000,000 and, upon conviction, additional fine or imprisonment.
• Use of weapons during tax offences: imprisonment up to five years; injuring a tax officer while armed: up to 10 years.
• Inducing a tax officer: individuals face N500,000, corporate bodies N2,000,000, possible imprisonment up to three years, plus payment of tax due.

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Virtual Asset Service Providers (VASP)

• Non-compliance: N10,000,000 for the first month, N1,000,000 for each subsequent month, or suspension/revocation of SEC licence.

FG clarifies 5 false claims on new tax law

Earlier, Legit.ng reported that the federal government has clarified that the new tax reforms taking effect in January 2026 will reduce, not increase, the tax burden for most Nigerians.

Chairman of Nigeria's Presidential Committee on Fiscal Policy and Tax Reforms, noted that, contrary to some reports suggesting new taxes are coming, individuals, small businesses, and large corporations stand to benefit under the revised laws..

He explained that individuals in the bottom 98% of income earners will pay less or no tax, while VAT on essential items such as food, education, and healthcare will be removed, lowering the cost of living.

Source: Legit.ng