Nigeria Enacts New Law Mandating Banks to Report Transactions Over N25m Monthly — NTAA 2026
Beginning January 2026, Nigerian banks, insurance companies, and financial institutions will be required to report monthly transactions exceeding ₦25 million for individuals and ₦100 million for corporate bodies to the tax authorities. This directive is outlined in Section 29 of the newly passed Nigeria Tax Administration Act (NTAA) and forms part of broader reforms under the Nigeria Tax Act 2025, aimed at improving tax transparency and enforcement.
Under the NTAA, financial institutions must submit quarterly returns, listing both new and existing customers whose monthly cumulative transactions meet or exceed the stated thresholds. This includes detailed customer information such as names and addresses. The aim is to enhance monitoring of high-value financial activities and strengthen revenue collection through better tax compliance and oversight.
In addition to reporting large transactions, banks and similar institutions are now designated as third-party debt recovery agents. The law allows tax authorities to assign the recovery of outstanding tax debts to these institutions or accredited recovery agents, but only after exhausting all legal avenues. This clause broadens the enforcement capabilities of the Federal Inland Revenue Service (FIRS) and other tax bodies.
The NTAA also specifies judicial processes for debt recovery involving failed banks. Courts will hold exclusive jurisdiction over unresolved debts from failed financial institutions, ensuring structured legal handling. The law supersedes any existing agreements or legal barriers, giving courts the authority to settle these matters directly.
Furthermore, the Act permits the use of accredited third-party agents—including debt recovery firms and financial institutions, to recover significant outstanding tax debts. However, such assignments will only be made after prior steps like notifications and enforcement actions have failed. This provision reinforces the federal government’s commitment to tighten tax enforcement and expand its revenue base through institutional collaboration.
Source: Vanguard