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How Nigerian taxes work

In Nigeria, taxes are paid based on who you are, what you earn, and where the income comes from. If you earn income — whether as an employee, business owner, freelancer, or professional — you are required by law to declare and pay applicable taxes.

Taxes are generally:

Calculated on income or transactions
Filed periodically (monthly or annually)
Paid to the relevant tax authority

The goal of compliance is simple:
Pay the right tax, at the right time, to the right authority.

WETH helps you do this correctly without guesswork.

Difference between LIRS and FIRS

Nigeria has two major tax authorities, and which one applies to you depends on your situation.

LIRS (Lagos State Internal Revenue Service)
Handles personal income tax for individuals and employees living or working in Lagos State.
FIRS (Federal Inland Revenue Service)
Handles company taxes and certain federal taxes, such as company income tax, VAT, and withholding tax for businesses.

WETH automatically determines which authority applies to you based on your details.

Who needs to file taxes?

You are required to file taxes if you fall into any of these categories:
You are employed and earn a salary
You are self-employed, a freelancer, or consultant
You run a registered business or company
You earn income from multiple sources (salary + side business, rentals, contracts, etc.)

Even if:

Tax is deducted at source, or
You believe you owe nothing

You may still be required to file a return.
Filing is about reporting, not just paying.

Common mistakes to avoid

Many tax issues arise not from fraud, but from simple mistakes, such as:
Not filing because “tax was already deducted”
Filing under the wrong tax authority
Guessing figures instead of calculating properly
Missing deadlines
Ignoring tax notices or assessments
Waiting until penalties accumulate before acting

These mistakes often lead to:

Arbitrary assessments
Best of Judgment (BOJ)
Penalties and interest
Stressful back-and-forth with tax offices

WETH is designed to help you avoid these issues from the start.

What to do next

If you’re unsure where you fit or what applies to you, you don’t need to figure it out alone.

Use WETH to determine applicable taxes
Choose the compliance flow that fits you
Get guidance or expert support when needed

Frequently Asked Questions

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