Tax ID to Become Mandatory for Bank Accounts, Financial Services from 2026

Beginning January 1, 2026, all Nigerians and non-residents will be required to possess a Tax Identification Number (Tax ID) to open or operate bank accounts in the country. The requirement is contained in the Nigeria Tax Administration Act, 2025, signed into law by President Bola Tinubu.

The new legislation makes the Tax ID compulsory for a wide range of financial activities, including banking, insurance, stockbroking, and allied services. It also mandates the use of a Tax ID for entering into contracts with federal and state governments, while non-residents conducting business in Nigeria are also affected, as the law compels foreign individuals and entities supplying taxable goods and services or deriving income from the country to register for tax purposes and obtain a Tax ID. To ensure compliance, the Act empowers tax authorities to automatically assign Tax IDs to individuals or businesses that fail to register, as it also provides for the suspension or deregistration of Tax IDs when businesses temporarily or permanently cease operations, provided due notice is given to the relevant authorities.

 Furthermore, the law is expected to significantly impact Nigeria’s financial system, as banks and other financial institutions will be required to verify Tax ID compliance before offering services. Industry experts predict the reform will expand the tax net, strengthen compliance, and boost government revenue as financial institutions have until the end of 2025 to adjust their systems and processes ahead of the enforcement date.

Written by Adeyemi Adewale