Nigeria is entering a new era in tax enforcement, and if you’re plugged into fintech, digital payments, or even just planning to open a bank account in 2026, pay close attention.
The government’s goal is simple: stop losing billions of naira to tax evasion and plug revenue leakages, especially in the booming digital economy. But the method is revolutionary instead of just relying on tax officers sending letters and court summons, tax enforcement is now being integrated directly into the financial system itself.
Here’s what that means and why it matters.
Why This Matters Now
Nigeria has historically struggled with tax evasion. According to fiscal analysts, compliance among eligible taxpayers, especially small businesses and digital economy players, remains worryingly low. Traditional methods just haven’t kept up with a world where money moves fast, cross-border digital activity explodes, and new forms of income are hard to track.
With tax‐to‐GDP ratios hovering well below global averages, the government has pushed a series of sweeping tax reforms that take effect in January 2026, including the Nigeria Tax Administration Act (NTAA) and Nigeria Tax Act, 2025. These reforms give tax authorities stronger powers and explicitly make banks and fintech companies key partners in compliance.
Banks and Fintechs: The New Frontline in Tax Enforcement
Automatic Reporting of Large Transactions
Under the NTAA, financial institutions (banks, fintechs, insurers, payment aggregators, etc.) are legally required to report:
- All monthly transactions above ₦25 million for individuals
- And ₦100 million for corporate entities
to the Federal Inland Revenue Service (FIRS) without being asked.
Chairman of the Presidential Fiscal Policy & Tax Reforms Committee, Mr Taiwo Oyedele, explained that this new threshold (up from ₦10 million) means a more focused compliance landscape, “almost ₦100 million a year before any report is triggered.
This isn’t just accounting, it’s surveillance as it makes large movement of funds is now automatically visible to tax authorities.
Real-Time VAT Monitoring
Perhaps the most disruptive change is the real-time transaction tracking system introduced by FIRS.
Through API integrations with banks and fintech platforms, every VAT-eligible transaction, even small online payments, is routed through a national monitoring portal. This gives FIRS:
- instant visibility into VAT activity
- automatic reconciliation of invoices
- the ability to cross-check taxpayers’ own filings against actual payment streams
FIRS Chairman Zacch Adedeji described the system as a “transformative leap in transaction visibility,” making the digital marketplace fairer and more transparent.
For everyday users, this can mean stricter VAT deduction at source from services you use, from e-commerce checkouts to fintech transfers.
Banks as Tax Intermediaries and Agents
Under the 2025 Act, banks and fintechs are no longer neutral facilitators. They now have statutory tax duties:
- Verify a valid Tax Identification Number (TIN) before onboarding customers
- Link account data to tax profiles
- Withhold and remit taxes like VAT and withholding tax automatically
- Assist in tax debt recovery when legally directed by authorities
In practice, this could mean a bank freezing an account or placing a lien if a customer’s tax debt isn’t resolved, all executed electronically instead of through long court battles.
What the Authorities Are Saying
Zacch Adedeji, FIRS Chairman, has been vocal about Nigeria’s tax transformation strategy:
“We are harnessing technology and intelligence… building a tax system that is proactive, smart, and secure.”
Similarly, the Minister of State for Finance, Dr Doris Uzoka-Anite, reinforced that:
“By investing in smart technology and real-time data exchange, we can detect and prevent illicit funds from leaving the country.”
These aren’t just words; they reflect a data-first, enforcement-driven approach that views banks and fintechs as essential components of tax compliance infrastructure.
Tech, Privacy, and Cybersecurity Concerns
With so much financial and personal data being shared with tax authorities, cybersecurity becomes crucial. Recent analysis suggests that the entire system, including third-party databases, should meet robust encryption, access control, and auditing standards to protect citizens’ rights while securely enabling tax enforcement.
What This Means for Young Nigerians
If You’re a Gig Worker or Freelancer
- You might need a TIN just to open a bank account or operate digital finance tools. (Social reports suggest this requirement will become widespread.)
- Digital income streams like crypto gains or online business revenue are increasingly taxable and visible to authorities.
If You Use Fintech Apps Daily
- Expect tighter tax data sharing with FIRS.
- Micro-transactions will be traced for VAT compliance.
- Fees may adjust as platforms build in tax collection and reporting mechanisms.
If You’re Building a Startup
- Compliance isn’t optional: fintech startups must register for tax data reporting, or risk penalties including fines and possible licence revocation.
A New Compliance Landscape
By 2026, Nigeria’s banks and fintechs won’t just move money, they’ll help enforce tax laws using automated data feeds, real-time tracking, and intelligent systems. This won’t just change compliance; it will reshape Nigeria’s financial ecosystem for better transparency, stronger revenue generation, and potentially fairer tax systems.
For young Nigerians, this means greater digital accountability, but also better tools to understand and fulfil tax obligations in the digital age.
Read Also: https://techsudor.com/how-cbn-policies-continue-to-reshape-nigerias-fintech-playbook/
