Following the official commencement of the 2026 fiscal year, the Federal Government of Nigeria has moved to fully integrate the digital economy into the national tax net. Under the newly enacted Nigeria Tax Administration Act (NTAA), the National Identification Number (NIN) for individuals and the Corporate Affairs Commission (CAC) registration number for businesses have officially replaced the traditional Tax Identification Number (TIN) as the primary identifiers for all tax-related activities.
This strategic harmonization, which took effect on January 1, 2026, is designed to simplify tax compliance and enhance transparency across the burgeoning cryptocurrency and freelance sectors.
Key Reforms for the Digital Asset Sector:
Unified Tax ID System: To eliminate administrative bottlenecks, Nigerians no longer need to apply for a separate TIN. A citizen’s NIN or a company’s CAC number now serves as the mandatory “Tax ID” required by banks and Virtual Asset Service Providers (VASPs) to maintain accounts and process transactions.
Mandatory Reporting for Crypto Exchanges: Starting this month, all cryptocurrency exchanges and VASPs operating in Nigeria are legally required to report user transaction details to the Nigeria Revenue Service (NRS). This includes transaction dates, asset types, values in Naira, and the identities of the parties involved.
Stiff Penalties for Non-Compliance: Crypto exchanges that fail to comply with these reporting standards face an administrative penalty of ₦10 million in the first month and ₦1 million for every subsequent month of default. Persistent non-compliance may lead to the suspension or revocation of operational licenses by the Securities and Exchange Commission (SEC).
Shift in Crypto Taxation: In a significant policy shift, profits from digital assets are no longer subject to a flat 10% Capital Gains Tax. Instead, they are now classified as “chargeable gains” under the Personal Income Tax framework, with progressive rates ranging from 15% to 25% for high earners.
Protecting Small-Scale Traders
While the government is intensifying its focus on the digital economy, the 2026 reforms include vital safeguards for small-scale participants. Individuals whose total annual income—including crypto profits—falls below the ₦800,000 threshold are exempt from income tax.
“The goal of the 2026 Tax Act is not to stifle innovation, but to ensure that the digital economy contributes its fair share to national development,” said a representative of the Presidential Committee on Fiscal Policy and Tax Reform. “By using the NIN and CAC numbers, we are making it easier for tech-savvy Nigerians and crypto traders to enter the formal economy without the burden of redundant paperwork.”
