To remit withholding tax in Nigeria, deduct the tax when you pay the supplier, pay it over and file the monthly schedule by the 21st day of the following month, then give the supplier a receipt for the amount deducted. A payment you make in October 2026 must be remitted by 21 November 2026.
Withholding tax (WHT) is an advance payment of your supplier's income tax. You hold it back from the invoice and send it to the tax authority on the supplier's behalf. If you deduct it and then sit on it, the money is the government's, and the penalty bill is yours.
When must you deduct and remit withholding tax in Nigeria?
PwC's Worldwide Tax Summaries (last reviewed 29 May 2026) states that WHT must be filed by the 21st day of the month following payment. A Mondaq commentary on the Deduction of Tax at Source (Withholding) Regulations 2024 puts the same deadline in different words: the 21st of the month after the month in which the tax was withheld.
Deduction point. For payments to third-party suppliers, you deduct when you pay or settle the amount, whichever comes first. For related-party transactions, PwC says deduction is due at payment or when the liability is recognised, whichever is earlier. If your group pays management fees late, the earlier date controls.
What are the WHT rates for companies?
The rates below are for payments to companies, as summarised by PwC. Confirm the rate for your exact transaction before you pay.
Dividends, interest and rent: 10% for resident and non-resident companies.
Commission, consultancy, technical, management and professional fees: 5% for resident companies and 10% for non-resident companies.
Construction of roads, bridges, buildings and power plants: 2% for resident companies and 5% for non-resident companies. Other construction and related work is 5% and 10%.
General services, and supply of goods by someone other than the manufacturer: 2% for resident companies. Non-resident companies are taxed at 5% on general services.
How do you remit withholding tax in Nigeria, step by step?
Step 1: Get the supplier's TIN before you pay. Put it on your vendor master file. Where a supplier has no TIN, PwC reports that the rate is doubled, up to a ceiling of 20%, except on passive income such as dividends. Mondaq notes the double rate applies to services and other non-passive income.
Step 2: Classify the payment. A single invoice often mixes a consultancy fee, a supply of goods and a rental. Split them and apply the right rate to each line. A blended rate on the whole invoice is the most common error we see in WHT reviews.
Step 3: Test for the small-transaction exemption. PwC says small companies are exempt from WHT deduction where the transaction value is below ₦2 million and the vendor has a valid TIN. Mondaq adds that the exemption applies to suppliers with annual turnover of ₦25 million or less, and that the ₦2 million is measured within the calendar month. Three ₦900,000 invoices to one vendor in the same month can take you over the line. Sources differ on whether exactly ₦2 million qualifies, so withhold if you are at the ceiling.
Step 4: Deduct at payment. Pay the supplier the invoice amount less the WHT, and record the deduction in a WHT payable account the same day.
Step 5: Remit and file by the 21st. PwC lists the monthly schedule contents as the supplier's TIN, address, nature of transaction, WHT deducted and invoice number. Mondaq adds the gross amount paid and the transaction month, and says a supplier without a TIN is identified by NIN or RC number. Include all of them. A schedule with gaps invites queries.
Step 6: Issue the receipt. Your supplier needs evidence of the tax deducted to claim credit against its own tax. Mondaq notes the Regulations do not set a deadline for issuing the receipt, so send it with the payment advice. Our guide on claiming a withholding tax credit shows what the supplier does with it.
Step 7: Reconcile every month. The WHT payable account should be zero after you remit. Any balance is either an unremitted deduction or a posting error. Find out which before the auditors do.
What happens if you deduct WHT but do not remit it?
PwC's summary lists a penalty of 40% of the amount not deducted, and 10% of the amount not remitted plus interest at the CBN Monetary Policy Rate. Mondaq, which discusses individuals, refers to an administrative penalty, annual interest and the unpaid tax itself. The percentages come from one source, so check them against the Regulations for your case.
The same logic applies to tax you hold on behalf of staff. We set out a ₦38 million example in what happens if you deduct PAYE but do not remit it.
What this means for your business
Take a ₦5,000,000 consultancy fee to a resident company. At 5%, you withhold ₦250,000, pay the supplier ₦4,750,000, and remit ₦250,000 by the 21st of the next month. If that supplier has no TIN, the rate doubles to 10%, and you withhold ₦500,000.
For construction, oil and gas, and NGO finance teams that pay many subcontractors and consultants, the risk is volume. One missed supplier TIN or one late month repeats across dozens of payments. Put a hard stop in the payment run: no TIN on file, no payment released at the standard rate.
A simple monthly calendar helps. Close payables by the 15th, build the WHT schedule by the 18th, pay and file by the 20th, and leave the 21st as your buffer.
FAQ
What is the deadline for remitting withholding tax in Nigeria? The 21st day of the month following the month the tax was withheld. A deduction made in March is due by 21 April.
Do I deduct WHT on payments below ₦2 million? Possibly not. PwC says the exemption applies where the transaction is below ₦2 million and the vendor has a valid TIN. Mondaq adds a ₦25 million annual turnover test for the supplier and measures the ₦2 million within the calendar month. If the vendor fails either condition, deduct.
What if my supplier has no TIN? The WHT rate is doubled, up to 20%, on non-passive income, according to PwC. Ask for the TIN before the first payment and keep a copy on file.
Need help building a WHT schedule, cleaning up your vendor TINs or reviewing past months for exposure? Contact VOG Global at vog.global. Our team in Area 10, Garki, Abuja works with finance teams across oil and gas, construction, banking, agriculture, NGOs and shipping.