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Nigerian Banks to Report Accounts With ₦5 Million Monthly Transactions to Tax Authorities

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Starting January 1, 2026, all Nigerian banks will be required to report customer accounts with monthly transactions of ₦5 million or more to the Federal Inland Revenue Service (FIRS) and other relevant tax authorities.

This directive is part of the 2025 Tax Reform Act, aimed at improving tax compliance, enhancing financial transparency, and expanding the country’s tax base.

The reporting requirement covers both inflows and outflows—meaning the total sum of money entering or leaving an account within a month. Once the ₦5 million threshold is reached, the bank is obligated to flag the account and send the details to tax authorities.

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The measure is designed to help the government identify individuals or businesses potentially underreporting their income or evading taxes, especially within the informal sector.

Other key changes in the new tax law include:

  • An increase in the personal income tax exemption from ₦500,000 to ₦800,000 annually
  • Capital gains tax exemptions for the sale of primary residences
  • Tax exemption on compensation payments up to ₦10 million
  • A revised revenue-sharing formula for Value Added Tax (VAT) among federal, state, and local governments
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While the policy is expected to boost government revenue and curb tax evasion, it has raised concerns over data privacy and the need for clear safeguards to protect customer information.

Bank customers who regularly transact ₦5 million or more in a month should be aware that their accounts will be subject to routine scrutiny by tax authorities from 2026.

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Hi, I’m Babawale Busari — a passionate storyteller, content creator, and observer of the world around me. I share compelling stories, current events, digital trends, and insightful commentary that spark thought and conversation. Whether it’s news, culture, tech, or everyday experiences, I believe every detail matters. Thanks for stopping by — let's explore the world, one post at a time.

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