If your business buys cloud hosting, software subscriptions, or ad space from a foreign supplier, Nigerian VAT law may put the responsibility to work out and pay that VAT on you, not the supplier — even though nothing on the checkout page mentioned it.
Under NTA 2025 §151, a non-resident supplier making taxable supplies to Nigeria must register and charge VAT on its own invoices. Where it doesn’t, the Nigerian business that bought the supply must withhold the VAT due and remit it to the NRS itself. This is a VAT-specific duty inside the Act’s VAT chapter — despite the word “withhold,” it has nothing to do with the separate withholding tax (WHT) TaxLane’s WHT calculator computes on professional fees, rent, or contracts paid to Nigerian suppliers.
The rule isn’t limited to “digital services” specifically, even though that’s how it’s often described — it covers any service or intangible right you buy from a non-resident supplier that’s consumed in Nigeria, however it’s delivered. In practice, for most Nigerian small businesses that means the foreign subscriptions and services they actually buy: cloud hosting (AWS, Google Cloud, Azure), SaaS/software subscriptions (Microsoft 365, Zoom, Canva), digital advertising (Google Ads, Meta Ads), and similar.
There's no public list of which non-resident suppliers are already registered or NRS-appointed to collect Nigerian VAT themselves, so the practical check is your own invoice or receipt: if it already itemizes 7.5% Nigerian VAT, the supplier is handling it and you don't need to do anything further. If it doesn't, the self-accounting duty falls to you as the buyer — the Act doesn't give you a way to confirm the supplier's registration/appointment status any other way.
The rate is the standard 7.5% VAT rate — the same one that applies to a business's own domestic sales, not a separate figure. TaxLane hasn't found a confirmed small-business exemption from this specific duty: the existing small-business VAT-filing exemption (NTAA §22(4)) covers filing monthly VAT returns and paying VAT to domestic suppliers, but doesn't mention §151, so a business under the ₦50 million VAT-exemption threshold isn't confirmed to be excused from self-accounting for VAT on a non-resident purchase.
This applies from 1 January 2026, when the rest of the Nigeria Tax Act took effect — TaxLane found no separate NRS notice phasing this rule in by business size or supplier type, unlike the NRS e-invoicing mandate's own staged rollout.
TaxLane doesn't have a dedicated calculator for this scenario yet — the amount itself, once you know you owe it, is the same 7.5% rate the VAT guide and VAT calculator already use, applied to what you paid the foreign supplier. This guide is informational only, not a filing or remittance channel.
Once you know you owe it, the amount is the same 7.5% rate the VAT calculator already uses.
There's no public list of which non-resident suppliers are already registered or NRS-appointed to collect Nigerian VAT themselves, so the practical check is your own invoice or receipt: if it already itemizes 7.5% Nigerian VAT, the supplier is handling it and you don't need to do anything further. If it doesn't, the self-accounting duty falls to you as the buyer — the Act doesn't give you a way to confirm the supplier's registration/appointment status any other way.
Under NTA 2025 §151, a non-resident supplier making taxable supplies to Nigeria must register and charge VAT on its own invoices. Where it doesn’t, the Nigerian business that bought the supply must withhold the VAT due and remit it to the NRS itself. This is a VAT-specific duty inside the Act’s VAT chapter — despite the word “withhold,” it has nothing to do with the separate withholding tax (WHT) TaxLane’s WHT calculator computes on professional fees, rent, or contracts paid to Nigerian suppliers.
No — for guidance only, not tax advice.