5 things exporters must know about Nigeria’s new tax regime

Exporters in Nigeria are facing new tax rules that affect how export income is treated, how businesses register for tax, and how incentives are accessed.

The changes introduce stricter documentation requirements and more closely link many incentives to verified export activity.

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Here are five things exporters should know

 

Export income can still be exempt, but proceeds must be repatriated

Nigeria continues to encourage non-oil exports through tax incentives, but the benefits now come with clearer conditions.

Under the Nigeria Tax Act 2025, profits from goods and services exported from Nigeria may qualify for tax relief if the export proceeds are repatriated through authorised banking channels.

In practice, exporters must demonstrate that foreign exchange earnings were repatriated through the official banking system, ensuring export activity translates into verified foreign exchange inflows.

If the proceeds are not repatriated through authorised financial institutions, the profits may become subject to the standard company income tax rate.

 

Free Trade Zone companies must maintain strong export activity

Companies operating in Nigeria’s Free Trade Zones (FTZs) have historically enjoyed broad exemptions from federal, state, and local taxes.

The new rules keep many of these incentives but introduce clearer limits, particularly for companies that sell into Nigeria’s domestic market.

To maintain certain benefits, FTZ companies must ensure that a significant share of their turnover comes from exports. Businesses that increasingly sell into the local market may lose some of the tax advantages associated with operating in the zones.

For export-focused manufacturers, the free zone structure can still offer significant benefits, but those advantages are now more closely tied to actual export performance.

All businesses must now register for tax

One major change under the Nigeria Tax Administration Act 2025 is that tax registration now applies to all businesses, even those that may not end up paying tax.

Exporters are required to register with the Nigeria Revenue Service (NRS) and obtain a Tax Identification Number (TIN).

This rule also affects companies working with foreign vendors. Nigerian firms that award contracts to unregistered entities may face a N5 million penalty, making proper registration essential for maintaining smooth commercial relationships.

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Documentation has become more important than ever

The new system places greater emphasis on proper record-keeping.

Exporters are expected to maintain clear documentation showing the flow of export proceeds and proof that funds were repatriated through authorised dealers.

Businesses may also be required to keep digital records of transactions, including invoices and supporting documents. As tax authorities rely more on electronic systems, exporters with incomplete records could face delays or penalties when claiming incentives.

Incentives are increasingly tied to real economic activity

Nigeria is gradually moving away from blanket tax holidays toward incentives linked to measurable business activity.

Rather than offering broad exemptions simply for operating in certain sectors, many incentives now reward companies that invest in manufacturing, processing, and value addition.

For exporters, this means the biggest benefits are likely to go to businesses that move further up the value chain, for example, exporting processed agricultural products rather than raw commodities.

Nigeria’s new tax laws aim to simplify the tax system while tightening compliance requirements.

For exporters, incentives remain available, but they now come with clearer rules and stronger documentation standards. As the new system takes hold, businesses that adapt early and maintain proper records will be better positioned to retain incentives and avoid penalties.