A new bill has been introduced in Nigeria, requiring individuals involved in banking, insurance, stock-broking, or other financial services to provide a Tax Identification Number (TIN) before opening or maintaining an account.
The bill, titled “A Bill for an Act to Provide for the Assessment, Collection of, and Accounting for Revenue Accruing to the Federation, Federal, States, and Local Governments; Prescribe the Powers and Functions of Tax Authorities, and for Related Matters,” aims to improve tax compliance and streamline revenue collection across the country.
Dated October 4, 2024, and obtained from the National Assembly, the bill stipulates: “Any person engaged in financial services in Nigeria must provide a tax ID as a precondition for opening a new account or operating an existing one.”
This requirement forms part of a wider strategy to ensure that all individuals and businesses in the financial sector are registered for tax purposes.
Additionally, the bill mandates that non-residents supplying taxable goods or services in Nigeria or earning income from the country must register for tax and obtain a tax ID. However, non-resident individuals with only passive investment income in Nigeria are exempt from registration but must still provide necessary information to the relevant tax authority.
The bill also grants the tax authority the power to automatically register individuals for a tax ID if they fail to apply. In such cases, the individual will be notified of their registration.
Non-compliance with these rules may result in penalties. According to the bill, individuals who fail to register will be fined N50,000 for the first month and N25,000 for each additional month of non-compliance.
