A friend told me she doesn’t need to file because she doesn’t run a business. Thousands of Lagos residents believe this. The LIRS says they’re all wrong, and the penalties start at ₦100,000.
I had a conversation with a friend yesterday about the LIRS tax filing deadline. April 14 is days away, and she hasn’t filed yet.
“Why not?” I asked.
“Someone told me I don’t need to file because I don’t have a business,” she said.
Wrong. Very wrong.
And she’s not alone. Thousands of Lagos residents believe the same thing. They think filing is only for business owners, entrepreneurs, and self-employed people. They think that if their employer already deducts PAYE from their salary, they’ve fulfilled their tax obligations.
The Lagos State Internal Revenue Service (LIRS) says this is one of the most common misconceptions about tax compliance. And it’s costing people money in penalties.
So let’s clear this up once and for all: Who actually needs to file tax returns in Lagos?
The simple answer: if you earned income in Lagos in 2025, you need to file
According to the LIRS, the following people are required to file annual tax returns by April 14, 2026:
- Salaried employees (yes, even if your employer deducts PAYE)
- Self-employed individuals and business owners
- Freelancers, content creators, and gig workers
- Professionals (lawyers, doctors, engineers, accountants, consultants)
- Landlords and property owners
- People with multiple income streams
- Informal sector operators (artisans, traders, independent service providers)
- Retirees with additional income
- Even people who earned below the taxable threshold (you file what’s called a “nil return”)
Notice anything? That list covers almost everyone who earns money in Lagos.
The requirement to file is not based on whether you have a business. It’s based on whether you earn income. Period.
“But my employer already deducts PAYE. Why do I need to file?”
This is the question another person asked. And it’s a good question. But here’s the answer:
Your employer deducts PAYE based only on the salary they pay you. They have no visibility into:
- Side hustles or freelance work you do
- Rental income from properties you own
- Dividends from investments
- Interest from savings accounts
- Income from a second job
- Business profits
- Any other source of income
Since your employer can’t see these other income streams, they can’t include them in their PAYE filings. That’s why you need to file your own return, to declare all your income from all sources.
But here’s the part people don’t understand: even if you have no other income besides your salary, you still need to file.
Why? Because filing isn’t just about paying additional taxes. It’s about reconciling your tax records with the LIRS. It’s about ensuring transparency and accuracy. It’s about updating government records.
And most importantly, it’s a legal requirement under the Nigeria Tax Administration Act 2025.
Let me show you who needs to file (with real examples)
Still not sure if you need to file? Let me give you concrete examples:
- Example 1: Sarah works for a bank. Sarah earns ₦300,000 per month. Her employer deducts PAYE every month. She has no side hustle, no rental income, no business.
Does Sarah need to file? YES. Even though her employer already deducted taxes, she still needs to file to reconcile her records with LIRS.
2. Example 2: Tunde is a freelance graphic designer. Tunde doesn’t have a traditional job. He takes on design projects for different clients and earns about ₦150,000 per month. No one deducts tax from his income.
Does Tunde need to file? YES. Self-employed people must declare their annual income and pay taxes directly.
3. Example 3: Bolu works full-time and sells clothes online. Bolu works for a tech company (PAYE deductions happen automatically) but also runs SplashRegalia, an online boutique on Instagram that brings in about ₦200,000 monthly.
Does Bolu need to file? YES. Her employer only knows about her salary. She needs to file to declare her side business income.
4. Example 4: Mr Adebayo is a landlord. Mr Adebayo retired from his job five years ago. He now lives off rent from two properties he owns in Lekki.
Does Mr Adebayo need to file? YES. Rental income is taxable, and landlords must declare it annually.
5. Example 5: Radiyah is a content creator. Radiyah makes money from brand deals, YouTube AdSense, and affiliate marketing. She doesn’t have a traditional job or registered business.
Does Radiyah need to file? YES. Digital earnings are taxable income, even if they come from foreign platforms.
6. Example 6: Tahir earns ₦80,000 per month. Tahir works as a driver and earns ₦80,000 monthly. That’s below the taxable threshold (first ₦300,000 annually is taxed at 7%).
Does Tahir need to file? YES. Even if you don’t owe taxes, you still file what’s called a “nil return” to stay compliant.
See the pattern? Everyone needs to file.
What the law actually says
The filing obligation is anchored in Section 24(f) of the 1999 Constitution and Sections 13 and 14(3) of the Nigeria Tax Administration Act 2025.
According to Ayodele Subair, executive chairman of LIRS: “Filing of annual tax returns is not optional. It is a legal requirement under the Nigeria Tax Administration Act 2025.”
Foluso Mustapha, director of Tax Audit at LIRS, confirmed: “Filing is not optional. It is a statutory obligation imposed on every taxable individual resident in Lagos State.”
The law requires “every individual with taxable income to submit a true and correct return of total income from all sources for the preceding year within 90 days of the commencement of a new assessment year.”
That means everyone who earned income between January 1 and December 31, 2025, must file by April 14, 2026.
What happens if you don’t file
The LIRS isn’t playing around with this deadline. Failure to file may attract penalties of ₦100,000 for the first month and ₦50,000 for each additional month of default.
Beyond the money, not filing means:
- You can’t get a Tax Clearance Certificate (TCC)
- You can’t apply for loans (banks require TCC)
- You can’t bid for government contracts (TCC is mandatory)
- You can’t process visa applications (embassies often request TCC)
- You face enforcement measures and interest charges
So when my friend said she doesn’t need to file because she doesn’t have a business, she was setting herself up for a ₦100,000 penalty.
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The bottom line
Let me make this as clear as possible:
If you earned any form of income in Lagos in 2025, salary, business profits, freelance fees, rental income, investment returns, digital earnings, anything, you need to file your tax returns by April 14, 2026.
It doesn’t matter if:
- Your employer already deducts PAYE
- You don’t have a registered business
- You earned below the taxable threshold
- You think you don’t owe any additional taxes
Filing is a legal requirement. Not optional. Not negotiable.
The good news? The process is fully digital and can be done from your phone. It takes 15-45 minutes if you have your documents ready. The LIRS eTax portal at etax.lirs.net walks you through every step.
The bad news? The deadline is April 14. That’s 2 weeks away. And penalties start immediately after that.
So if you’re reading this and you haven’t filed yet, whether you have a business or not, go file. Right now. Before it costs you ₦100,000.
And if you have friends who think they don’t need to file because they don’t have a business, share this with them. Because someone needs to tell them the truth before the penalties start.
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