Nigerian govt issues guidelines on taxation of cryptocurrency, virtual assets, imposes penalties

Nigeria's tax authority has introduced new guidelines to regulate and tax virtual assets, including cryptocurrencies. The Nigeria Revenue Service (NRS) released the framework on Monday, targeting taxpayers, Virtual Asset Service Providers (VASPs), peer-to-peer marketplace operators, and tax practitioners. This move follows President Bola Tinubu's signing of a Presidential Executive Order on Virtual Assets Coordination in July, aimed at harmonizing digital asset regulation and combating financial fraud. The guidelines establish a clear administrative process for taxing virtual assets, detailing obligations for registration, reporting, record-keeping, and valuation. They align with Nigeria's Tax Act and Tax Administration Act. The NRS stated the guidelines aim to provide clarity and certainty in the evolving virtual asset ecosystem, encouraging voluntary tax compliance and fostering a fair tax system for digital asset transactions. The tax authority urged all stakeholders to adhere to the new rules. The guidelines also specify penalties for non-compliance. VASPs and P2P operators face administrative penalties of N10 million for the first month of default and N1 million for each subsequent month. These obligations include tax deduction, stamp duty collection, VAT accounting, timely remittance, filing returns, and maintaining records. Other sanctions include penalties for failure to file returns, incomplete filings, and failure to deduct taxes at source. Failure to register can result in penalties of N50,000 for the first month and N25,000 thereafter, while record-keeping failures incur N50,000 for companies and N10,000 for individuals. Failure to respond to demands or requests carries daily penalties, and failure to disclose facts in dutiable instruments also incurs administrative penalties.

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The introduction of the virtual assets guidelines came after President Bola Tinubu signed the Presidential Executive Order on Virtual Assets Coordination, 2026, to harmonise digital asset regulation and curb financial fraud on 17 July.