Banks to report accounts with N25m quarterly turnover under new tax laws — Oyedele

Taiwo Oyedele, chairman of the presidential fiscal policy and tax reforms committee, says Nigeria’s new tax reform laws will require commercial banks to report accounts with a quarterly turnover of N25 million to the tax authorities.

Oyedele spoke on Friday during a media parley on the tax reform laws, noting that the reforms raised the reporting threshold from N10 million to N25 million.

The federal government gazetted the new tax reform laws on September 9, with implementation scheduled to commence on January 1, 2026.

“What this one has done is that it has raised the threshold for reporting your bank account. I think it was N10 million before, but it is now N25 million, which translates to N100 million,” he said.

He recalled that the Finance Act of January 13, 2020, introduced a requirement for individuals and businesses to link their tax identification number (TIN) to bank accounts used for business or income purposes.

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“If you are using it for business or for any income, like a salary earner,” he said, adding that some individuals and businesses have since complied with the directive.

Oyedele said the requirement of “putting TIN in your business account” was reviewed by the committee and incorporated into the new tax laws.

“But because the level of tax awareness in Nigeria is so poor, people are finding out so many things for the first time,” he said.

“They just assume that the new tax law is introducing them. This one is actually not.”

Clarifying his remarks in a chat with TheCable, Oyedele said the existing tax laws already empower banks to file customer information with tax authorities, while the new law makes disclosure mandatory once certain thresholds are met.

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“The context is that the current tax law already requires the filing of customer’s information by banks to the tax authority while the new law prescribes a mandatory disclosure for threshold of N25m per quarter (for an individual) and N100m (for a company) under the new law,” he said.

Oyedele also dismissed concerns that the reforms would allow government agencies to arbitrarily debit bank accounts.

“Even if you have N1 billion in the account, nobody can debit your bank account. That’s why I took you through the process of, if you’re not paying your taxes, they write to you, write back, you do final assessment, conclusive, and then you go to court, and then it’s a long process,” he said.

“I have been in this space for three decades. I have not seen — the power, which is in the law — one instance where they have used it in Nigeria before.”

He stressed that neither the Federal Inland Revenue Service (FIRS), the Central Bank of Nigeria (CBN), commercial banks nor any government agency has the authority to unilaterally withdraw funds from personal or business accounts.

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“No one has the power to debit your account. In the law, there is what we call power of substitution. In some countries, they will say garnishee order,” Oyedele said.

“This is the order where if the money you earn is plenty, let’s say if you have like N200 million tax to pay, the taxman can go through the stress of sending your assessment, your debt to go to court to determine who is right.

“He can say ‘pay’, the court said you should pay. You refuse to pay. They say, but you have money in your account.”

Oyedele explained that only after a court order is obtained can a bank be notified that an individual or company owes the government and has refused to settle the liability.

“That’s the extreme case when they use it. It will not apply to anyone that I know in Nigeria,” he said.

“But you cannot remove that power from the law because it may become necessary, right?

“So I think the message to all Nigerians is nobody is taking any amount from their bank account. Whether their bank account has 50k or 50 million, nobody is taking anything from the bank account.”