NRS or SIRS: Who Should You Register With for Tax in Nigeria? You have a Tax ID. You run a business. You earn income. But who should you deal with: the Nigeria Revenue Service (NRS) or your State Internal Revenue Service (SIRS)?

This is one of those tax questions that sounds simple until you start looking at the details.

A company, a sole proprietor, a remote worker, an NGO and a non-resident business can all have tax obligations in Nigeria, but the relevant tax authority may not be the same for each of them.

The Nigeria Tax Administration Act (NTAA) 2025 provides the framework for determining which tax authority is responsible. It also requires every taxable person to register with the relevant tax authority and obtain a Tax ID.

So, before you register somewhere simply because someone told you to, it is worth understanding what you are registering as and what tax obligation you are trying to meet.

The simple rule: start with who you are

The easiest way to understand Nigeria’s tax registration framework is not to start with the tax itself.

Start with the taxpayer.

Are you:

• An incorporated company?
• A resident individual?
• A sole proprietor?
• A partnership?
• A non-resident business?
• An NGO or incorporated trustee?
• A government agency?
• A business making taxable supplies for VAT?

Your answer can determine which authority has jurisdiction over the relevant tax.

The NTAA gives the NRS exclusive responsibility for certain categories, while State and FCT tax authorities retain responsibility for taxes imposed on resident individuals, subject to the federal responsibilities set out in the Act.

When the NRS is your tax authority

The NRS is responsible for a number of federal tax areas and specific categories of taxpayers.

1. Companies

If you operate through an incorporated company, the company’s tax administration falls within the NRS’s jurisdiction.

This applies whether the company is carrying on business in Lagos, Abuja, Kano or another part of Nigeria.

Your company’s location does not turn its company income tax obligation into a State income tax obligation.

2. Non-resident persons with Nigerian tax obligations

A business or individual based outside Nigeria does not automatically escape Nigerian tax administration.

Under the NTAA, a non-resident person that supplies taxable goods or services to a person in Nigeria, or derives income from Nigeria, is required to register for tax and obtain a Tax ID, subject to the specific exception for certain passive investment income.

This is particularly relevant to foreign companies providing services to Nigerian customers.

3. VAT

VAT is another important reason businesses interact with the NRS.

The NTAA gives the NRS responsibility for administering VAT.

So, a business may have two different tax relationships:

State tax authority: for applicable personal income tax where the taxpayer is a resident individual.

NRS: for applicable federal taxes such as VAT.

This is where the common confusion begins.

What about a sole proprietor?

This is probably one of the most important distinctions for small business owners.

Imagine you run a fashion business, consulting practice, online store or catering business in your own name or as a registered business name, rather than through a limited company.

For income tax purposes, you are still an individual.

The NTAA assigns State/FCT tax authorities responsibility for the administration of taxes imposed on resident individuals.

So, registering a business name with the Corporate Affairs Commission does not automatically turn the owner into a company taxpayer.

The business structure matters.

A sole proprietor can therefore have a State personal income tax obligation while also having federal tax obligations such as VAT where applicable.

And if you are simply an individual?

For a resident individual, the relevant State or FCT tax authority generally administers personal income tax.

This covers income, profits or gains of resident individuals within the framework set out in the NTAA.

And the Nigeria Tax Act 2025 makes an important distinction here: the income, gains or profits of a Nigerian resident individual are chargeable to tax in Nigeria wherever they arise, whether or not the income has been brought into or received in Nigeria.

That means your tax situation cannot always be determined simply by asking:

“Where did the money come from?”

Your residency and the nature of the income can matter just as much.

What about partnerships, trusts and other structures?

This is where trying to apply a simple “NRS for businesses, SIRS for individuals” rule can become misleading.

The tax laws contain specific provisions for different structures, including partnerships, trusts, estates and other entities.

For example, the Nigeria Tax Act 2025 provides specific rules for determining how income from trusts, settlements and estates is treated.

The relevant authority therefore depends on the taxpayer and the particular tax obligation involved.

In other words, don’t register based on the name of the structure alone. Look at the actual tax obligation.

The part many business owners miss: one business can deal with more than one authority

This is perhaps the most useful takeaway.

Being registered with a State tax authority does not necessarily mean the NRS has nothing to do with you.

Likewise, having a Tax ID or dealing with the NRS for VAT does not necessarily mean your personal income tax obligation has moved to the NRS.

Think of it this way:

The exact treatment can depend on the taxpayer’s structure and the particular tax involved. The NTAA expressly provides for the federal and State/FCT division of responsibilities.

But what about your Tax ID?

Here’s another area where taxpayers can easily get confused.

The NTAA requires every taxable person to register with the relevant tax authority and obtain a Tax ID. It also provides that a taxable person with a valid Tax ID should not apply for or be issued another Tax ID.

The current NRS Tax ID system also describes the Tax ID as a unique number linked to recognised identity records such as NIN for individuals and CAC records for businesses.

So the objective is not to collect multiple tax identities simply because you interact with different authorities.

The bigger question is whether your tax profile correctly reflects who you are and what you do.