By: Erewunmi Peace

The Federal Inland Revenue Service (FIRS), now operating under the new Nigeria Revenue Service (NRS) framework, has announced strict enforcement of the Tax Administration Act 2025, set to take effect from January 1, 2026.

This move aims to strengthen tax compliance across Nigeria, especially among small, medium, and large-scale businesses.

Key Offenses and Penalties

According to the newly enacted policy, the following will attract serious penalties:

Violation Penalty

Undocumented transactions Fines up to ₦10 million or imprisonment
Failure to disclose office address Fines from ₦10,000 to ₦5 million
Unregistered vendor transactions Up to ₦5 million fine
Refusal to adopt fiscalization tools ₦1 million fine

Businesses that fail to register, file annual tax returns, or update their information with NRS will also face monthly penalties and possible prosecution.

FIRS Speaks

A senior spokesperson for the tax body stated:

“The goal is to ensure full accountability. We cannot continue to allow shadow operations that rob the country of needed revenue. Every business must play by the rules.”

What This Means for Businesses

Companies must document all transactions with receipts, e-invoices, or digital records.

All office locations must be formally registered with the tax authority.

Firms must begin using fiscalization technology such as POS-integrated tax tools.

Virtual asset service providers (VASPs) and digital businesses are also expected to comply.

With this development, FIRS/NRS is clearly signaling a zero-tolerance policy toward tax evasion. Nigerian businesses are advised to review their compliance status immediately to avoid the stiff penalties that await defaulters from January 2026.