From 1 January 2026, every individual and corporate customer—Nigerian or foreign resident—must supply a Tax Identification Number (Tax ID) when opening or operating a bank account, under provisions of the newly enacted Nigeria Tax Administration Act, 2025, signed by President Bola Tinubu.
The legislation obliges financial institutions to verify Tax IDs not only for banking services but also across insurance, stockbroking, government procurement, and other regulated sectors. By widening the scope beyond banks, lawmakers aim to embed tax compliance into multiple revenue-generating activities.
Non-resident persons and companies earning income or supplying goods and services in Nigeria must obtain a Tax ID before conducting any taxable transaction. The Act empowers the Federal Inland Revenue Service to issue identifiers to unregistered parties and to suspend or cancel IDs belonging to businesses that cease operations without proper notice.
Officials explain that broadening mandatory Tax ID usage will expand the nation’s tax base and bolster federal revenue. Independent analysts predict the requirement will strengthen enforcement against evasion and improve overall compliance rates.
Banks and other affected firms must upgrade their customer-onboarding systems to interface with the FIRS registration database. Institutions will integrate Tax ID checks into Know-Your-Customer processes, ensuring no new or existing account remains unverified beyond the January deadline.
Industry participants caution that smaller businesses and expatriate individuals may face administrative hurdles during the transition. Nevertheless, financial sector leaders insist that enhanced transparency and reduced informal transactions will yield long-term gains.
Under the new rules, institutions that accept transactions from customers lacking a valid Tax ID risk regulatory sanctions, including account suspension and fines. The Act stipulates that services be withheld until the necessary registration is completed.
Observers note that comparable measures in other jurisdictions have driven revenue growth when combined with robust public-awareness campaigns. Nigeria’s adoption of digital registration portals and inter-agency data-sharing reflects international best practice in modern tax administration.
To facilitate compliance, the FIRS plans to collaborate with banks, insurance houses, stock exchanges and corporate service providers on outreach and technical support. Entities are urged to begin the registration process immediately to avoid a year-end rush.