A VAT return is only as good as the paperwork behind it. The return itself is a summary; the invoices and records are the evidence.
Why your invoice is the return's evidence
Every figure on a monthly VAT return traces back to an invoice, whether it is output VAT you charged or input VAT you are claiming. Our guide to input VAT recovery covers what a claim needs behind it, and a missing invoice is the simplest way to lose that claim.
What a government buyer's invoice trail also shows
Selling to a federal, state or local government body works a little differently. The buyer collects or withholds VAT itself and remits it by the 14th day of the following month, together with a schedule of supplier names, Tax IDs and invoice details.
That means your own invoice records need to match what the government buyer is separately reporting about you.
How long records have to be kept
At least six years after the year of assessment. That applies to anyone required to keep books, not only companies, and records must be in English or translated at your own cost if they are not.
Six years is longer than most people expect, and longer than the five-year window for claiming input VAT itself.
The penalty for records that are missing or wrong
Failing to keep proper books, or failing to produce them when asked, costs ₦50,000 for a company and ₦10,000 for anyone else. That penalty applies on top of any knock-on effect on a VAT claim the missing records would have supported.
What a solid invoice trail looks like in practice
A sales register that lists every invoice issued, and a purchase register that lists every invoice received, are the two documents most audits actually ask for first. Keep them updated monthly rather than reconstructed once a year.
Bank statements, delivery notes and contracts are useful supporting evidence too, particularly where an invoice alone does not settle a query. None of these replace the invoice itself, but together they make a claim far harder to challenge.
Where e-invoicing changes this
The NRS is rolling out the Merchant-Buyer Solution (MBS), which issues invoices through the tax authority's own system rather than relying purely on a business's internal records. Our guide to who this applies to, and when covers the rollout dates by business size.
Until your category is required to join, ordinary record-keeping is still what your VAT return and any audit will be checked against. Building good habits now, before e-invoicing reaches your business, makes the eventual switch far less disruptive.
See the VAT monthly return guide for the filing process these records feed into, or browse more NRS and Rev360 articles.