- As the January 2026 commencement date for the Tax Identification Number, Nigerians are curious about several things
- To clear the confusion spreading on social media, there are several questions bogging the minds of Nigerians
- Legit.ng delves into the myths and facts about the Tax ID and provides a clear understanding before the enforcement
Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
As Nigeria prepares to enforce the use of Tax Identification Numbers from January 1, 2026, confusion and anxiety have spread across social media, banking halls, and business circles.
Many fear blocked accounts, forced deductions, or fresh registration hurdles.
Credit: State House
Source: Getty Images
In a recent explainer, Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, addressed these concerns and clarified what the law truly says. Here is a clear breakdown of the key facts every Nigerian needs to understand.
Tax ID is not new
Despite the noise, the Tax ID requirement is not a fresh policy. It has existed since the Finance Act of 2020, which amended the Personal Income Tax Act.
Anyone operating a bank account for business purposes has been required to have a tax identifier since then. The new law simply strengthens enforcement and harmonises existing rules.
You don’t need a Tax ID for personal banking
Ordinary personal savings accounts are not affected. If your bank account is not used for business, investments, or income generation, you do not need a Tax ID.
Salary earners and individuals with basic personal accounts are not the target of this enforcement.
Why “Tax ID” replaced “TIN”
Tax ID is now a unified term. Previously, different agencies issued different identifiers.
Under the new system, an individual’s National Identification Number or a company’s CAC registration number will serve as the Tax ID. This eliminates duplication and simplifies compliance.
Existing TIN holders don’t need to reapply
If you already have a Tax Identification Number, nothing changes. Your existing TIN remains valid and automatically transitions into the Tax ID framework. There is no need for fresh registration.
No physical card, no biometrics
Tax ID is simply a number, not a card. There is no biometric capture, no queues, and no collection exercise.
Registration is done online via the Joint Tax Board portal or at FIRS, State IRS, or JTB offices. The process is free. No official payment is required.
Businesses must comply
All businesses require a Tax ID.
Small, unregistered businesses can use the owner’s personal Tax ID. Companies, NGOs, and incorporated trustees automatically receive a TIN during CAC registration.
Older businesses that missed this step can update their records online or at FIRS using CAC documents.
Nigerians in the diaspora are covered
Nigerians abroad who operate bank accounts for business or income in Nigeria can obtain a Tax ID using their NIN through a simplified online process.
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Do you have tax ID? FG sends message to Access, Zenith, other banks on TIN on bank accounts
However, if the account is not used for income or business activities, a Tax ID is not required.
Foreign companies must also register
Foreign companies doing business in Nigeria are required to obtain a Tax ID. Non-resident firms supplying goods or services are required to register.
Those earning only passive income, such as dividends or royalties, may not require full registration but must still provide relevant tax details.
Companies effectively managed from Nigeria are treated as residents and must comply fully.
Government agencies are not exempt
The law applies to all ministries, departments, agencies, and government-owned enterprises at the federal, state, and local levels. Public institutions are equally required to obtain Tax IDs.
What happens after January 1, 2026
Most taxable persons are already compliant. Those who are not may face difficulties operating business-related bank accounts.
This does not affect individuals without taxable income from business or investments.
No automatic tax deductions from bank accounts
The fear of direct government debits is unfounded. Tax recovery from bank accounts is a last resort and requires due process, often involving court orders.
This power already exists in old tax laws and is rarely used, typically for large, undisputed liabilities involving high-net-worth individuals or major corporations.
Nigerians’ bank deposits are safe
Regardless of account size, deposits remain secure. Having a Tax ID does not give the government automatic access to personal funds.
Why this matters to ordinary Nigerians
The goal is a fairer, simpler, and more transparent tax system. By linking tax identity to NIN or CAC numbers, compliance becomes easier, loopholes are closed, and duplication is removed.
Credit: Taiwo Oyedele/X
Source: Twitter
Those who earn taxable income contribute their fair share, while low-income Nigerians who are exempt remain protected.
At its core, the Tax ID framework is about order, clarity, and fairness, not punishment or panic.
FG unveils Nigerians exempted from income Tax
We earlier reported that the federal government has announced major personal income tax exemptions that will take effect from January, offering relief to millions of low-income earners as enforcement of Nigeria’s new tax reforms begins.
Under the reforms, individuals earning up to about N100,000 per month will no longer be required to pay personal income tax.
The announcement was made by Taiwo Oyedele, chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, who said the changes had been designed to reduce hardship, improve fairness, and reset the relationship between citizens and the tax system.