A late return under the old rules could feel like a formality. Under the Nigeria Tax Administration Act 2025, administered by the Nigeria Revenue Service (NRS), formerly FIRS, the penalties are now written out in fixed amounts.
What counts as a late return
Filing after your deadline counts, but so does filing something incomplete or wrong. Section 101 of the Nigeria Tax Administration Act 2025 treats an incorrect or incomplete return the same as one that was never filed at all.
That is a stricter standard than it sounds. A rushed return with a genuine error can trigger the same penalty as one that was never submitted.
The penalty for the first month
Miss the deadline, and the first month costs ₦100,000. This applies whether or not any tax is actually owed, because every taxable person must file a return each year, even if no tax is due.
The penalty for each month after
The cost does not stay flat. Every month the return remains outstanding after the first adds ₦50,000. A return left unfiled for several months adds up quickly once each period is counted separately.
Interest on top of the penalty
The late-filing penalty covers the return itself. Separately, tax that is paid late attracts its own consequences: a 10% penalty on the amount paid late, plus interest.
The interest rate itself is reviewed periodically. The current naira rate is the CBN Monetary Policy Rate plus 1 percentage point, under a government Order made in 2026. Check the NRS's own published rate before relying on an exact figure for a calculation, since it is set to change from time to time.
How to avoid it
The most reliable fix is filing on time, even with an estimate, rather than waiting until every figure is final. A return can usually be corrected after filing; a return that was never filed at all cannot be corrected, only penalised.
Our compliance deadline calendar is built for exactly this, tracking filing dates across VAT, withholding tax and the rest so a deadline does not arrive as a surprise.
If VAT is the return you are most likely to miss, our guide to filing it sets out the steps and the due date in full.
Why the fixed-amount structure matters
Under the old regime, penalties were sometimes calculated as a percentage of tax due, which meant a business with little or no tax owed had little to fear from filing late. A fixed amount changes that calculation entirely.
A small company with no tax liability this year still faces the same ₦100,000 if its return is late, because the penalty is tied to the act of filing, not to the size of the bill. That is worth planning around even in a quiet year.
Common mistakes
- Waiting for perfect figures before filing. An estimate filed on time is treated far better than an accurate return filed late.
- Assuming no tax due means no penalty risk. The late-filing penalty attaches to the return, not to the amount owed.
- Forgetting interest is separate from the penalty. Clearing the penalty does not automatically clear interest that has built up on unpaid tax.
For how registration and returns work under the same Act, read the Nigeria Tax Administration Act explained. For the small-company exemption that affects some of these duties, see our dedicated piece, and browse the NRS and Rev360 hub for the rest.