Nigeria sets virtual-asset tax and reporting framework

The circular is administrative guidance rather than a new tax law. The Nigeria Tax Act 2025 has applied since 1 January 2026 and expressly brings profits or gains from digital-asset transactions within taxable income. Circular 2026/21 applies to taxpayers, virtual-asset service providers, peer-to-peer marketplace operators, financial institutions and other persons that acquire, dispose of, exchange, receive or provide services involving virtual assets.^[1][2]

Income tax and withholding depend on the asset and transaction

The Revenue Service divides virtual assets into six categories, including cryptocurrencies, stablecoins, security tokens, utility and governance tokens, non-fungible tokens and sovereign digital currencies. Companies are taxable on profits from activities including trading, exchange services, custody, token issuance, mining, staking and decentralised-finance returns. For relevant disposals of category 1, 3 and 5 assets, a VASP or VASP-operated marketplace is instructed to withhold 1% of gross disposal proceeds. The circular uses the US dollar as the reference currency for gain calculations before converting the gain into naira at the disposal-date rate.^[1]

Service fees and token conversions carry separate indirect-tax rules

A transfer of a virtual asset does not itself constitute a VATable supply, but VASP service fees are subject to 7.5% VAT. The circular also directs VASPs to collect 1.5% stamp duty on specified token-to-fiat and fiat-to-token transactions by reference to item 33 of the Ninth Schedule to the Act. These positions should be treated as the Revenue Service’s stated administration of the legislation, including where the circular supplies detailed mechanics beyond the statutory wording.^[1][2]

VASPs and qualifying P2P operators must require a valid tax identification number, deduct and collect applicable taxes, submit returns and retain records. Withholding tax and stamp duty are generally remitted in the originating token, while VAT is remitted in the transaction currency. The circular states a penalty of ₦10 million for the first month and ₦1 million for each subsequent month of VASP or P2P marketplace non-compliance. Cross-border groups should therefore align onboarding, wallet, valuation and reporting systems before relying on the circular’s non-disposal treatment for qualifying transfers with no change in beneficial ownership.^[1]