Starting January 1, 2026, anyone dealing in digital assets will fall under Nigeria’s tax net
That includes crypto
A lot of people are asking
Why should we pay tax
Why not protest when it feels like public funds don’t improve our lives
Those arguments come up every time
But legally, tax payment isn’t optional
The 1999 Constitution makes it mandatory
Who is actually required to pay
Nigeria uses two main tests
Residency
If you live in Nigeria, your income is taxable here
Source
Even if you live abroad, if your income comes from Nigeria, it can still be taxed
If neither applies to you, this won’t concern you
Types of tax that matter for crypto
Taxes are split into indirect and direct
VAT is the main indirect tax, but unless you’re collecting it on behalf of others, it usually doesn’t affect individuals directly
What most people need to understand are direct taxes
Personal Income Tax (PIT)
This is a tax on what you earn in a year
Nigeria uses a progressive system
Higher income means higher tax rates
For simplicity
Income here means money you earn from crypto related activity
Airdrops that are earned count as income
Crypto received purely as a gift generally does not
Examples of taxable crypto income
Airdrops
Mining
Staking rewards
Web3 jobs and freelancing
DeFi yields
Any activity where crypto is earned as compensation
Example
If you earn the equivalent of ₦2.9M from airdrops in a year
The first ₦800K is taxed at 0%
The remaining ₦2.1M is taxed at 15%
That equals ₦315K in tax
Your final tax can be lower if you qualify for reliefs
Rent relief is one common example
Companies Income Tax
Companies are treated as separate legal persons
They pay tax based on Annual Gross Turnover
Small companies
AGT below ₦50M
No companies income tax
Medium and large companies
AGT above ₦50M
Taxed at 30%
Capital Gains Tax
If you buy crypto and later sell at a profit
That profit is taxable
The gain is added to your total income for the year
Losses can be deducted before tax is calculated
In simple terms
All profits from crypto in a year are added together
Losses are deducted
Eligible reliefs are applied
The balance is taxed under PIT rates
How tax is paid
Nigeria operates a self assessment system
At the end of the financial year
You declare your income
Apply deductions and reliefs
Calculate what you owe
And pay the tax authority
Final thoughts
Tax payment is compulsory
Failure to pay is tax evasion and carries penalties
That said
You are allowed to structure your finances legally
To reduce how much tax you pay
That’s tax avoidance
And it’s lawful
The question is simple
Will you ignore it
Or plan properly
