VAT and WHT affect how Nigerian businesses invoice their clients, but they work differently. VAT is added to your invoice at 7.5% if your business is required to charge it, while WHT is deducted by the client from your payment and remitted to the tax authority on your behalf.
Knowing how both taxes work helps you understand what to include on your invoices, how much to charge, and what to expect when a client pays. This guide explains the current VAT and WHT rules in Nigeria, with practical invoice examples to show how the calculations work.
Panorama general del sistema tributario nigeriano para empresas
Autoridades tributarias clave
El sistema tributario nigeriano funciona a través de diferentes autoridades que supervisan distintos tipos de impuestos y diferentes categorías de contribuyentes.
- Nigeria Revenue Service (NRS): Supervisa el IVA, el impuesto sobre la renta de las empresas, las retenciones fiscales y los impuestos para las entidades corporativas.
- Servicios Estatales de Impuestos Internos (SIRS): Handles Personal Income Tax for individuals and sole proprietors
- Joint Revenue Board (JRB): Funciona como un organismo que unifica la administración tributaria estatal a través de sus esfuerzos de coordinación.
¿Cuáles son los principales impuestos que afectan a la facturación?
Varios impuestos afectan directamente cómo son las facturas emitido en Nigeria:
- Impuesto sobre el Valor Añadido (IVA): El impuesto se aplica a todo suministro que incluya bienes y servicios gravables.
- Impuesto de retención (WHT): Los impuestos se deducen de ciertas transacciones mediante retenciones directas en origen.
- Impuesto sobre la Renta de las Sociedades (IRS): Las empresas deben pagar este impuesto en función de sus beneficios, que deben acreditar mediante la documentación de sus facturas.
- Impuesto sobre la Renta de las Personas Físicas (IRPF): Este impuesto se aplica tanto a los trabajadores autónomos como a los empresarios individuales.
Requisitos de identificación fiscal
Para emitir facturas que cumplan con las obligaciones fiscales, las empresas pueden necesitar:
- Número de Identificación Fiscal (NIF): Esto es obligatorio para todas las personas sujetas a impuestos.
- Número de registro del IVA: Obligatorio para las empresas que hayan obtenido el registro del IVA.
Both numbers must be displayed on the invoices according to the requirements. The NRS issues TINs and VAT numbers, which taxpayers must use for their tax filings, remittances, and audits.
Por qué es importante el cumplimiento normativo
Las facturas que no cumplen con los requisitos pueden tener las siguientes consecuencias:
- Corporate clients rejecting the submitted invoices
- VAT claims being denied
- The NRS imposes penalties and interest
- Una probabilidad mucho mayor de una auditoría.
Una facturación adecuada protege tanto a su empresa como a sus clientes.
What Is VAT and Who Charges It?
VAT is a 7.5% tax on taxable goods and services in Nigeria. Businesses required to charge VAT add it to their prices and show it separately on invoices. The rate remains 7.5% under the Nigeria Tax Act, 2025, which took effect on 1 January 2026.
¿Quién debe registrarse para el IVA?
The Nigeria Tax Administration Act, 2025 defines a small business as one with annual gross turnover of ₦100 million or less and total fixed assets below ₦250 million. Businesses providing professional services are excluded from this classification.
Qualifying small businesses are exempt from charging VAT. However, they can choose to opt out of the exemption by notifying the Nigeria Revenue Service and registering to charge VAT.
Exenciones del IVA
Some goods and services are exempt from VAT, while others are taxable at 0%. These categories are not the same, so check how a supply is classified before adding VAT to an invoice.
Examples of supplies that may fall under these categories include:
- Alimentos básicos
- Productos médicos y farmacéuticos
- Educational books and materials
- Medical services
- Tuition fees
- Qualifying exported goods and services
Exempt supplies and zero-rated supplies also have different rules for claiming input VAT. If you are unsure which category applies to what you sell, confirm with a tax professional before issuing the invoice.
What Are the VAT Requirements on Nigerian Invoices?
If your business is required to charge VAT, show it as a separate line on the invoice. Include:
- Your business name and address
- Your VAT registration details, where applicable
- The invoice date and a unique invoice number
- A description of the goods or services supplied
- The amount before VAT
- The VAT amount charged
- The total amount payable, including VAT
How Do You Calculate VAT in Nigeria?
Calculate VAT by multiplying the taxable amount by 7.5%. For example, if a service costs ₦200,000, the VAT is ₦15,000. The total invoice amount is therefore ₦215,000. You can use this formula when calculating VAT on an invoice
What Is WHT and Who Deducts It?
Debido a una idea errónea muy extendida, la gente suele pensar erróneamente que la retención de impuestos funciona de la misma manera que el IVA.
¿Qué es la retención de impuestos?
Withholding Tax (WHT) is an advance payment of income tax deducted from certain payments to suppliers. Instead of paying the full amount to you, the client deducts the applicable percentage and remits it to the relevant tax authority on your behalf.
WHT is not an extra charge you add to your invoice. It is deducted from the amount the client owes you. In most cases, you can use the deduction as a credit against your income tax.
¿Quién deduce la retención de impuestos?
- El cliente o pagador deduce WHT.
- El proveedor no cobra WHT.
- El importe deducido reduce el pago final al proveedor.
Certificados y créditos de retención de impuestos
El cliente necesita crear una nota de crédito de retención de impuestos después de deducir la retención, que sirve como comprobante de pago de impuestos y permite al contribuyente disminuir las obligaciones tributarias futuras. La imposibilidad de obtener certificados de retención de impuestos resulta en que los contribuyentes experimentar doble imposición.
¿Cuáles son las tasas comunes de retención de impuestos en Nigeria?
The applicable rate depends on the type of transaction and whether the supplier is a Nigerian resident. Under the Deduction of Tax at Source (Withholding) Regulations, 2024, common rates for resident suppliers include:
| Transaction | WHT rate |
|---|---|
| Professional, consultancy, technical and management fees | 5% |
| Commission | 5% |
| Other services not specifically listed | 2% |
| Supply of goods or materials by someone other than the manufacturer or producer | 2% |
| Construction of roads, bridges, buildings and power plants | 2% |
| Other construction and related activities | 5% |
Estas tasas varían en función del tipo de transacción y de la situación del contribuyente.
¿Cómo calculo la retención de impuestos en Nigeria?
La retención en origen se calcula como un porcentaje del importe facturado, excluido el IVA, y se deduce antes de que se realice el pago.
Can Small Companies Be Exempt from Deducting WHT?
The 2024 regulations provide an exemption from the obligation to deduct WHT for qualifying small companies, provided the supplier has a valid Tax Identification Number (TIN) and the transaction value does not exceed ₦2 million during the relevant calendar month.
This exemption concerns the client’s responsibility to deduct WHT. It does not automatically exempt the supplier from other tax obligations. Because the regulations refer to an earlier definition of a small company, confirm eligibility with a tax professional before relying on the exemption.
What Happens When a Client Deducts WHT?
When a client deducts WHT from your payment, request the receipt showing the amount withheld and the relevant transaction details. The receipt serves as evidence of the deduction when you claim the amount as a tax credit.
Keep it with your invoice and payment records. If the client deducts WHT but does not provide the receipt, follow up and request it.
Impuesto sobre la Renta de las Sociedades (IRS) y Facturación
¿Cómo se relaciona el CIT con las facturas?
Las facturas son la principal evidencia de ingresos para el cálculo del Impuesto sobre la Renta de las Sociedades. El Servicio Federal de Impuestos Internos (FIRS) utiliza las facturas para calcular lo siguiente:
- Volumen de negocios
- Reconocimiento de ingresos
- Reclamaciones de gastos
¿Qué debo conservar para cumplir con la normativa CIT?
Las empresas deben conservar los siguientes documentos:
- Facturas emitidas
- Confirmaciones de pago
- Notas de crédito de WHT
- declaraciones de IVA
Worked Example: A ₦500,000 Services Invoice
Suppose a VAT-registered consultant charges a Nigerian company ₦500,000 for professional services. The service attracts 7.5% VAT, and the client must deduct 5% WHT.
First, calculate the VAT:
- Service fee: ₦500,000
- VAT at 7.5%: ₦37,500
- Total invoice: ₦537,500
Next, calculate WHT. The 5% deduction applies to the service fee before VAT, not the VAT-inclusive total.
- Service fee: ₦500,000
- WHT at 5%: ₦25,000
- Total invoice: ₦537,500
- Less WHT: ₦25,000
- Amount the client pays: ₦512,500
The client pays the consultant ₦512,500 and remits the ₦25,000 WHT to the relevant tax authority. The consultant is responsible for accounting for the ₦37,500 VAT collected.
| Invoice description | Cantidad |
|---|---|
| Professional service fee | ₦500,000 |
| VAT (7.5%) | ₦37,500 |
| Invoice total | ₦537,500 |
| Less: WHT (5% of service fee) | (₦25,000) |
| Net amount payable | ₦512,500 |
The consultant should keep the WHT receipt or credit note as evidence of the deduction. The ₦25,000 can be claimed as a tax credit, subject to the applicable rules.
Worked Example: A Goods Invoice
Suppose a business supplies goods worth ₦800,000 to a company. If the goods are subject to VAT and the supplier is required to charge it, the invoice will show VAT separately.
Calculate the VAT:
- Cost of goods: ₦800,000
- VAT at 7.5%: ₦60,000
- Total invoice: ₦860,000
If the transaction also attracts 2% WHT, the client deducts ₦16,000 from the goods value.
| Invoice description | Cantidad |
|---|---|
| Cost of goods | ₦800,000 |
| VAT (7.5%) | ₦60,000 |
| Invoice total | ₦860,000 |
| Less: WHT (2% of goods value) | (₦16,000) |
| Net amount payable | ₦844,000 |
The client pays the supplier ₦844,000 and remits the ₦16,000 WHT to the relevant tax authority. The supplier accounts for the VAT collected, subject to the applicable VAT rules.
However, not every sale of goods attracts WHT. The applicable regulations provide exemptions for certain transactions, including qualifying supplies by manufacturers or producers. Check whether the transaction is subject to WHT before including a deduction in your payment calculation.
How to Show VAT and WHT on the Invoice
When preparing an invoice that includes VAT and WHT, show the amount for each clearly. VAT is added to the taxable amount, while WHT is deducted by the client from the payment.
Under Section 153 of the Nigeria Tax Act, 2025, a VAT invoice must contain the following details:
- El nombre y la dirección de la empresa
- El número de identificación fiscal (NIF), así como el número de IVA, si corresponde.
- Un número de factura único
- La fecha de la factura
- La información del cliente
- Descripción de bienes o servicios
- El importe neto
- El importe del IVA, si procede.
- El importe total adeudado
- Las condiciones de pago
The invoice should also show the VAT amount separately so the client can identify the tax charged. It must be issued when the supply is made, even if the client has not paid yet.
How Should You Display VAT and WHT?
For clarity, structure the invoice to show:
| Invoice detail | What to include |
|---|---|
| Supply amount | Cost of goods or services before VAT |
| TINA | Applicable rate and VAT amount, shown separately |
| Invoice total | Supply amount plus VAT |
| WHT | A note that the client may deduct WHT where applicable |
| Net payment | Amount remaining after any applicable WHT deduction |
WHT should not be presented as an additional tax charge added to the invoice total. The client calculates and deducts it when making payment, then remits it to the relevant tax authority.
If the transaction is subject to WHT, you can include a short note explaining that the client should provide evidence of the deduction after remittance.
Invoicing software like Billing automatically applies your TIN, VAT number, and invoice numbering to every invoice you create, so you stay FIRS-compliant without having to check each invoice manually.
Keeping Records for the NRS
Keep copies of your invoices, receipts, payment records, and other documents that support your business transactions. Section 31 of the Nigeria Tax Administration Act, 2025 requires businesses and other taxpayers to maintain records for at least six years after the relevant year of assessment.
The NRS is also introducing electronic invoicing in phases. Businesses with annual turnover below ₦1 billion are scheduled for stakeholder engagement from January to March 2027, a pilot rollout from April to June 2027, and go-live on 1 July 2027. Compliance enforcement is scheduled for January to March 2028, although the NRS may adjust these timelines.
¿Cuáles son los requisitos para la factura de un profesional independiente?
La factura de cada profesional independiente debe incluir lo siguiente:
- Nombre personal o comercial
- Número de Identificación Fiscal (NIF)
- Descripción de los servicios prestados
- Número y fecha de la factura
- Nota sobre la retención de impuestos (cuando corresponda)
- Instrucciones de pago
El IVA debe incluirse si el profesional independiente está registrado a efectos del IVA.
Preguntas frecuentes
1. Who pays WHT in Nigeria: the client or the supplier?
The client deducts WHT from the payment owed to the supplier and remits it to the relevant tax authority. The supplier receives the balance and can claim the deduction as a tax credit.
2. What if my client deducts WHT but does not give me a receipt?
Ask your client for a WHT receipt or credit note as evidence of the deduction and remittance. You need this document to support your tax credit claim.
3. Is VAT charged on exports from Nigeria?
Qualifying exported goods and services attract VAT at 0% in Nigeria. This means VAT applies at a zero rate rather than the standard 7.5% rate.
4. Do freelancers charge VAT in Nigeria?
Freelancers who provide taxable goods or services may need to charge VAT if they are required to register. However, professional service providers do not qualify for the small-business VAT exemption.
5. What is the difference between VAT and WHT?
VAT is added to the price of taxable goods or services and collected by the supplier. WHT is deducted by the client from certain payments and remitted to the tax authority.
6. How much tax should I add to an invoice?
If your business is required to charge VAT, add 7.5% to the taxable amount and show it separately on the invoice. Do not add WHT as an extra charge because the client deducts it from your payment where applicable.
Reflexiones finales
Comprender cómo las leyes fiscales nigerianas afectan a sus facturas es fundamental para un negocio sostenible y que cumpla con la normativa. El IVA, la retención en origen y el impuesto sobre la renta influyen en la forma en que se redactan y utilizan las facturas. De esta manera, podrá recibir pagos más rápidos, evitar desacuerdos y reducir la probabilidad de una auditoría.
Use the Calculadora de impuestos de Nigeria to estimate applicable taxes, and consult a qualified tax professional for advice on your specific situation.
