‎The Nigeria Tax Act, 2025 (NTA) was signed into law on 26 June 2025. The enactment of this law led to many concerns and questions by citizens, particularly in relation to the regularization of taxes.
‎The tension was alarming, and it gave rise to many views, opinions, and massive confusion by different orators who felt a little knowledgeable to explain this concept.
‎Now here’s what the new tax law regulates.
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‎THE SIMILARITY BETWEEN THE OLD TAX LAW AND NEW TAX LAW

‎The recent enacted act contains certain sections which was previously stated in the first Act. The Act consolidates many prior tax statutes (e.g., the Companies Income Tax Act, the Personal Income Tax Act, the Capital Gains Tax Act, the Value Added Tax Act) into one unified framework.
‎The effective date for many of the new provisions is 1 January 2026, although some administrative and transitional provisions may already apply.

CONTENT OF THE NEW TAX ACT
‎The new law broadens definitions, expands tax base, tightens compliance, modernizes administration (through the Nigeria Revenue Service (NRS) replacing the Federal Inland Revenue Service (FIRS)).
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‎HOW THE NEW TAX LAW APPLIES TO INDIVIDUALS (PERSONS)
‎This new law has major impacts on the these categories highlighted. With respect to the individuals, Residents / Individuals will be taxed on worldwide income, gains or profits. The definition of “resident individual” according to the act has been explained to include habitual abode, family ties, or a person residing in Nigeria for 183 days or more. In lay terms, individuals are not limited to the citizens of Nigeria, this implies that visitors staying for the period of 183 days or more, and non citizens, shall be eligible to pay taxes. Furthermore, Individuals who earns from employment, freelance work, or other services, should also ensure they are registered with (TIN), and maintain proper records, and file returns. There are strict penalties for individuals who fail to adhere to these rules.
‎Now for residents who earn from foreign income may be subjected to tax in Nigeria.
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‎HOW THE NEW TAX LAW APPLIES TO BUSINESS NAMES
‎It is important to note that a business name in Nigeria is not a separate corporate entity unlike a limited company. This implies that the tax treatment applies to the individual owner.
‎Profits of the business name are treated as the owner’s personal income and taxed under personal income tax rules (for the individual).
‎If an individual is operating under a business name, It is advised that they must have a record for business, because your personal tax return must include the business profit.
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‎HOW THE NEW TAX LAW APPLIES TO APPLICATION TO LIMITED COMPANIES
‎The NTA retains the corporate income tax regime. Resident companies pay tax on worldwide profits; non-residents pay on Nigerian‐source profits.
‎The definition of “Nigerian company” is expanded to include a company incorporated in Nigeria, or whose place of central management/control is in Nigeria, may be treated as resident.
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‎CONCLUSION
‎This is how the tax law affects these categories of persons, it is streamlined to residents and citizens of Nigeria.