FG Orders Banks to Report Monthly Transactions Above N25m for Individuals, N100m for Firms

The federal government has directed all banks and financial institutions in Nigeria to report monthly transactions exceeding N25 million for individuals and N100 million for corporate entities to the tax authorities. This directive forms part of new provisions under the Nigerian Tax Act, aimed at improving tax compliance and tightening oversight of financial flows.

As stipulated in the Act, financial institutions must submit quarterly returns to the Federal Inland Revenue Service (FIRS), which is set to be renamed the Nigeria Revenue Service starting January 2026 when the new tax regime takes full effect. Institutions responsible for deducting and remitting taxes are now also required to render monthly returns to the relevant tax authority, as outlined in the updated regulations.

The new law requires banks, insurance companies, stockbroking firms, and other financial entities to provide quarterly reports listing the names and addresses of new and existing customers whose cumulative monthly transactions hit the N25 million threshold for individuals or N100 million for corporate organisations.

Before the enactment of this law, the reporting requirement applied only to deposits of N5 million and above. The revised limits are part of broader efforts to combat money laundering and enhance financial transparency in line with international standards.

In 2023, Nigeria was placed on the grey list by the Financial Action Task Force (FATF) due to gaps in its frameworks for tackling money laundering and terrorism financing. The government has since been working to address these issues. In November 2024, Hafsat Bakari, CEO of the Nigerian Financial Intelligence Unit, confirmed that Nigeria had made significant progress on five of the FATF’s key recommendations.