The four taxes every Nigerian SME owes — and when they're due
VAT, PAYE, Pension, and CIT: what each one is, who owes it, and the dates that actually matter. A plain-English guide for founders without a finance team.
If you run a registered Nigerian business, you owe at least four taxes. Not five, not ten — four core ones. Most founders we talk to know they exist but couldn't tell you which is due tomorrow versus next quarter. So here's the short version, in the order you're likely to encounter them.
VAT — Value Added Tax
What it is: 7.5% on the goods and services you sell.
Who owes it: Every business with annual turnover above ₦25 million. Below that, you're exempt — but you can still register voluntarily if your customers want to claim VAT input.
When it's due: The 21st of every month, for the previous month's invoices. Miss it and the penalty is the higher of ₦50,000 or 10% of the unpaid VAT, plus interest.
Where it goes: Federal Inland Revenue Service (FIRS).
The trap most SMEs fall into: collecting VAT but not separating it from working capital. By the time the 21st rolls around, the cash is gone. Treat VAT like it's not yours — because it isn't.
PAYE — Pay As You Earn
What it is: Income tax deducted from each employee's salary, at progressive rates from 7% to 24%.
Who owes it: You, if you employ anyone — including yourself if you take a salary from your own Ltd. The employee bears the tax, but you remit it.
When it's due: The 10th of every month, for the previous month's payroll.
Where it goes: Your state's Internal Revenue Service. Lagos businesses file with LIRS, Abuja with FCT-IRS, etc.
PAYE is where the rules get fiddly because every state has its own forms and slightly different deadlines for annual reconciliation. The monthly remittance is universal, though.
Pension — Pension Reform Act contributions
What it is: A combined 18% retirement contribution — 10% from the employer, 8% from the employee — paid into the employee's Retirement Savings Account (RSA).
Who owes it: Any employer with three or more employees.
When it's due: Within 7 working days of paying salaries.
Where it goes: The employee's chosen Pension Fund Administrator (PFA). PenCom regulates.
This one trips up early-stage SMEs because the deadline is tied to your payroll date, not a fixed monthly date. If you pay salaries on the 25th, pensions are due by ~the 5th of next month.
CIT — Companies Income Tax
What it is: 20% to 30% of profit, depending on your size:
- Small companies (turnover < ₦25M): 0% — exempt
- Medium companies (₦25M–₦100M): 20%
- Large companies (₦100M+): 30%
Who owes it: Every Nigerian-incorporated company, even if you owe ₦0 because you're a small company. You still have to file.
When it's due: Within 6 months of your fiscal year end. If your year ends 31 December, CIT is due by 30 June.
Where it goes: FIRS.
CIT is annual, which means it's the easiest to forget until it's late. Most accountants estimate it quarterly so you're not surprised in June.
What Emiday does for each
For every workspace, we draft these four returns automatically. VAT is recalculated every time a sales invoice or expense lands. PAYE updates every time payroll runs. Pension follows the same trigger. CIT runs as a quarterly estimate that tightens as the year closes.
You see the next one due at the top of your dashboard. One click pays it through FIRS or your state IRS — no portals, no paper, no late nights in May trying to remember whether you remitted last month.
If your books are in order, the four taxes are quiet. If they're not, the four taxes are very loud, very expensive, and very public. The good news: it's a solved problem.