By TaxMateNG
Running a business in Nigeria is hard enough without the constant anxiety of tax compliance. If you are an employer with three or more staff, you are likely already on the Federal Inland Revenue Service (FIRS) radar. But here is the secret that most wealthy corporations know: Tax laws are not just about paying money; they are about saving it.
Most Nigerian SMEs pay significantly more tax than they legally owe because they treat tax as an afterthought rather than a strategy. They miss out on Reliefs, Capital Allowances, and Sector Exemptions simply because they don't know they exist.
TaxMateNG was built to change that. It is more than just a calculator; it is a "CFO in your pocket" that helps you navigate the complex Nigerian Tax Act (NTA) offline and privately.
Here is the 3-step guide to legally slashing your tax liability—sometimes down to ₦0.00.
The first step in tax planning is knowing your category. In Nigeria, the law treats "Small Companies" very differently from large corporations.
If your annual turnover is under ₦50 Million, you are generally exempt from paying Companies Income Tax (CIT). If it is under ₦100 Million, you are likely exempt from VAT obligations (depending on the specific Finance Act year).
Many businesses hover around these thresholds and panic. They voluntarily register for taxes they don't owe or fail to register when they cross the line. TaxMateNG allows you to toggle between NTA thresholds to see exactly which legal advice fits your revenue level.
If you do register for VAT, do not make the mistake of claiming back every kobo you pay.
The Rule: You can only claim "Input VAT" on goods purchased for direct resale or production.
The Trap: You cannot claim VAT on "Overheads" like office rent, furniture, or diesel.
How TaxMateNG Helps: When you log expenses, the app automatically separates Recoverable VAT (inventory) from Non-Recoverable VAT (overheads). This ensures you don't accidentally claim a refund you aren't entitled to—the fastest way to trigger an audit.
Most small employers lose money because they don't know how to claim "Capital Allowance" (tax-approved depreciation) on their computers, vehicles, or machinery.
Let’s say your bakery makes a ₦5,000,000 profit but you just bought a delivery van for ₦12,000,000.
Without TaxMateNG: You pay 30% tax on the full ₦5M profit (₦1.5M tax).
With TaxMateNG: The app calculates the statutory Capital Allowance (e.g., 25%). It deducts ₦3,000,000 from your profit before tax is calculated. Your new tax bill drops to ₦600,000.
Result: You save ₦900,000 cash.
This is the most powerful "hidden" feature in the tax law.
General Rule: Most businesses can only use Capital Allowances to wipe out 66% of their profit. You must pay tax on the remaining 33%.
The Exception: If you are in Manufacturing or Agriculture, this restriction is lifted. You can claim 100% of your allowances.
TaxMateNG’s Sector Dropdown handles this logic instantly. If you are a manufacturer, the app ensures you get 100% relief, potentially dropping your taxable profit to zero.
The final step is to ensure you aren't paying for past mistakes or paying the same tax twice.
Business is a rollercoaster. If you lost money last year (e.g., ₦10M loss), you shouldn't pay tax this year until you have fully recovered that amount.
The Strategy: Use the Prior Year Losses feature in TaxMateNG. If you made ₦8M profit this year, the app will apply last year's loss to wipe out this year's tax bill entirely, carrying forward the remaining ₦2M loss to next year.
Withholding Tax (WHT) is not an extra cost; it is pre-paid tax. When a client deducts 5% or 10% from your invoice, that money is sitting with the government in your name.
The Fix: TaxMateNG tracks your "WHT Credit Available." When your final tax bill is calculated, the app subtracts these credits. If you owe ₦1M but have ₦600k in WHT credits, you only pay the ₦400k difference. Without this tracking, many SMEs pay the full ₦1M, effectively paying tax twice!
Tax compliance isn't just about avoiding jail; it's about optimizing cash flow. By verifying your exemptions, maximizing asset deductions, and recovering your losses, you can legally minimize your liability.
Ready to stop overpaying? Download TaxMateNG to track your assets, toggle your sector exemptions, and generate audit-ready reports offline.
#SME #NigeriaBusiness #TaxMateNG #CITCompliance #BusinessGrowth