FG introduces market-linked interest for late tax payments from October 2026
Effective October 1, 2026, taxpayers who miss tax payment deadlines will pay interest tied to current market rates under a new FG order. For naira tax liabilities, interest will be the Central Bank's Monetary Policy Rate plus one percentage point, subject to a floor of the 364-day Treasury Bill yield. For foreign currency tax debts, interest applies at the Secured Overnight Financing Rate (SOFR) plus six percentage points.
The 10% penalty for late payment remains in addition to this interest. Rates will be fixed for each calendar month based on the benchmark rate on the last business day of the previous month, with the Nigeria Revenue Service publishing applicable rates on its website by the third business day of each month. Interest accrues daily on a simple interest basis from the date tax becomes due until payment is made.
This uniform framework applies to self-assessment and taxes assessed by the NRS, state internal revenue services, and FCT tax authority. Taxpayers with outstanding liabilities are advised to settle them promptly or engage relevant tax authorities, while all taxpayers should check monthly published rates and meet filing and payment obligations on time to avoid combined penalty and interest charges.