New tax rule authorises lifestyle audit to detect hidden income
AI Executive Briefing
Verified Synthesis~40s readThe Federal Government has authorised tax authorities to examine taxpayers’ lifestyles, assets, business locations and financial transactions to estimate undeclared business earnings under the Nigeria Presumptive Tax Regulations, 2026. Regulation 6(2) expressly excludes “any taxable person whose actual or estimated turnover from trade or business for the relevant year of assessment does not exceed twelve (12) million naira.” For businesses exceeding the exemption threshold and otherwise liable under the regime, Regulation 6(3) provides that they “shall be assessed to income tax at the rate of one percent (1 per cent) of their actual or estimated turnover.” This means an eligible business assessed at N20m annual turnover would face a presumptive income tax liability of N200,000, even where its actual profit cannot be established.
Context & Background
- ✦The regulations also prescribe a method for estimating annual business turnover from daily sales.
Key Figures & Named Entities
2026:The Federal Government has authorised tax authorities to examine taxpayers’ lifestyles, assets, business locations and financial transactions to estimate undeclared business earnings under the Nigeria Presumptive Tax Regulations, 2026.13 May:The regulations, published in the Federal Government’s Official Gazette dated 13 May, 2026, empower revenue agencies to assess businesses whose actual incomes cannot be reliably determined because of inadequate financial records or the concealment of relevant information.Friday:A copy of the regulations, obtained by The PUNCH on Friday from the website of the Joint Revenue Board, shows that tax officials can rely on several indicators, including information gathered from communities, to estimate business turnover where adequate financial records are unavailable.
Outlook & Next Steps
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Key Takeaways
Verified Extract- The Federal Government has authorised tax authorities to examine taxpayers’ lifestyles, assets, business locations and financial transactions to estimate undeclared business earnings under the Nigeria Presumptive Tax Regulations, 2026.
- Regulation 6(2) expressly excludes “any taxable person whose actual or estimated turnover from trade or business for the relevant year of assessment does not exceed twelve (12) million naira.” For businesses exceeding the exemption threshold and otherwise liable under the regime, Regulation 6(3) provides that they “shall be assessed to income tax at the rate of one percent (1 per cent) of their actual or estimated turnover.” This means an eligible business assessed at N20m annual turnover would face a presumptive income tax liability of N200,000, even where its actual profit cannot be established.
- The regulations also prescribe a method for estimating annual business turnover from daily sales.
Key Facts:2026: The Federal Government has authorised tax authorities to examine taxpayers’ lifestyles, assets, business locations and financial transactions to estimate undeclared business earnings under the Nigeria Presumptive Tax Regulations, 2026.13 May: The regulations, published in the Federal Government’s Official Gazette dated 13 May, 2026, empower revenue agencies to assess businesses whose actual incomes cannot be reliably determined because of inadequate financial records or the concealment of relevant information.Friday: A copy of the regulations, obtained by The PUNCH on Friday from the website of the Joint Revenue Board, shows that tax officials can rely on several indicators, including information gathered from communities, to estimate business turnover where adequate financial records are unavailable.2026: The regulations, issued as Statutory Instrument No. 24 of 2026, were made pursuant to Section 29 of the Nigeria Tax Act, 2025, and took effect on 1 January, 2026.
Editorial Excerpt
The Nigerian government has authorised tax authorities to conduct lifestyle audits to estimate undeclared income under the new Presumptive Tax Regulations.
Frequently Asked Questions About This Story
What is the latest development regarding Wale Edun?
The Federal Government has authorised tax authorities to examine taxpayers’ lifestyles, assets, business locations and financial transactions to estimate undeclared business earnings under the Nigeria Presumptive Tax Regulations, 2026.
Who are the key organizations or public figures mentioned?
The primary parties identified in this coverage include Wale Edun, Naira & Foreign Exchange Policy.
What timeline or key figures were confirmed?
The Federal Government has authorised tax authorities to examine taxpayers’ lifestyles, assets, business locations and financial transactions to estimate undeclared business earnings under the Nigeria Presumptive Tax Regulations, 2026.
