The federal government has directed banks and financial institutions to begin submitting monthly reports of high-value transactions to tax authorities. Under the new tax regulations, individuals whose transactions exceed ₦25 million and companies whose transactions exceed ₦100 million in a month must be flagged and reported.
This directive is part of changes introduced in the amended Nigerian Tax Act, set to take full effect in January 2026. Banks, insurance firms, and stock-broking companies are now required to file quarterly returns to the Federal Inland Revenue Service (FIRS), which will be renamed Nigeria Revenue Service (NRS).
In addition to quarterly filings, these institutions must now render monthly returns, disclosing the names and addresses of customers whose cumulative monthly transactions surpass the new thresholds. The aim is to tighten tax compliance and enhance financial monitoring.
Previously, the regulation only required banks to report individual cash deposits of ₦5 million and above. However, officials say the rising volume of digital transactions and evolving financial crime techniques have made the previous threshold obsolete.
The updated policy is intended to strengthen Nigeria’s financial transparency framework and improve its alignment with international anti-money laundering standards. Nigeria was placed on the Financial Action Task Force (FATF) grey list in 2023 due to gaps in combating money laundering and terrorist financing.
Since then, the country has implemented several reforms to meet FATF’s recommendations. These include broader transaction surveillance and improved collaboration between regulatory agencies and financial institutions.
In November 2024, the Nigerian Financial Intelligence Unit (NFIU) announced that Nigeria had made notable progress in five of FATF’s key priority areas. The development has raised optimism that the country could soon be removed from the grey list.
Officials say the new reporting system will help increase government revenue and deter illicit financial activities. Financial institutions are expected to comply fully once the law takes effect, with penalties in place for non-disclosure.
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