FG Releases New Tax Rules for Cryptocurrency, Sets Penalties for Non-Compliance
The Nigeria Revenue Service (NRS) has introduced new guidelines on the taxation of cryptocurrencies and other virtual assets, outlining how digital asset transactions will be taxed and the penalties for failing to comply.
In a statement issued on Monday, the NRS said the guidelines apply to taxpayers, Virtual Asset Service Providers (VASPs), peer-to-peer (P2P) marketplace operators, tax professionals and other participants in Nigeria’s digital asset ecosystem.
The new framework follows President Bola Tinubu’s signing of the Presidential Executive Order on Virtual Assets Coordination 2026, which aims to harmonise digital asset regulation and curb financial crimes.
According to the NRS, the guidelines establish clear rules for the taxation of virtual assets, including registration requirements, reporting obligations, record-keeping, asset valuation and the tax treatment of digital asset transactions.
The agency said the framework is in line with the Nigeria Tax Act 2025 and the Nigeria Tax Administration Act 2025, adding that it is designed to provide clarity, encourage voluntary compliance and improve transparency as the country’s virtual asset industry continues to grow.
Heavy penalties for defaulters
The NRS warned that Virtual Asset Service Providers and P2P marketplace operators who fail to meet their tax obligations will face strict penalties.
Operators who fail to deduct or remit taxes, collect stamp duties where applicable, account for Value Added Tax (VAT), file required returns or maintain proper records will be fined ₦10 million for the first month of default and ₦1 million for every additional month until they comply.
Other penalties include:
₦100,000 for failing to file tax returns or submitting incomplete returns in the first month, and ₦50,000 for each additional month.
A penalty equal to 40 per cent of any tax that should have been deducted but was not.
₦50,000 for failing to register in the first month and ₦25,000 for each subsequent month.
₦50,000 for companies and ₦10,000 for individuals who fail to keep proper records.
₦100,000 for ignoring official notices on the first day, followed by ₦10,000 for each additional day.
₦100,000, a ₦50,000 fine upon conviction, up to three years imprisonment, or both, for failing to disclose facts relating to dutiable instruments.
₦100,000 for failing to notify the tax authority of a change of address in the first month and ₦50,000 monthly thereafter.
The guidelines also state that anyone who fails to remit tax deducted at source will pay a 10 per cent annual penalty, plus interest based on the Central Bank of Nigeria’s Monetary Policy Rate (MPR).
False VAT refund claims will attract a penalty equal to 100 per cent of the amount claimed, in addition to interest.
Taxpayers who fail to pay taxes on naira transactions will also face a 10 per cent penalty plus interest, while foreign currency transactions will attract a similar penalty alongside the Secured Overnight Financing Rate (SOFR) and applicable spreads.
The NRS stressed that these sanctions are in addition to any other penalties or offences provided under existing tax laws.
Different tax treatment for digital assets
The agency classified virtual assets into three main categories:
Cryptocurrencies and exchange tokens.
Fiat-backed stablecoins.
Digital tokens representing financial or investment rights, including profit-sharing and revenue-sharing tokens.
For stablecoins, gains will be calculated using the value of the underlying fiat currency, while withholding tax will not apply when they are sold.
The NRS also clarified that converting naira into virtual assets for international payments will not be treated as a taxable transaction. However, any future sale of those assets will be taxed.
Virtual assets received as salaries, wages or professional fees will be taxed based on their market value on the day they are received.
Similarly, rewards earned through staking, mining, decentralised finance (DeFi) activities and liquidity incentives will be treated as taxable income when received, with that value becoming the acquisition cost for future tax calculations.
For non-fungible tokens (NFTs), creators will pay tax on income earned from sales as business income, while investors will be taxed on profits made from selling NFTs held as investments.
The NRS said the new guidelines are intended to bring Nigeria’s growing cryptocurrency industry into the formal tax system while providing greater certainty for taxpayers and improving compliance.
