Understanding Nigeria’s Immigration, Tax & Labour Laws: A Complete Guide for Businesses
If you’re planning to expand your business into Nigeria or hire expatriate and local talent, understanding the country’s immigration procedures, tax system, and labour laws is essential. Nigeria, Africa’s largest economy, offers vast opportunities, but compliance is the key to success.
This article highlights 10 essential facts that help businesses stay compliant and thrive while doing business in Nigeria.
Table of Contents
- Overview: Doing Business in Nigeria
- Immigration in Nigeria
- Work Authorization Requirements
- Validity & Renewal of Work Permits
- Dependent Residence Permits
- Tax in Nigeria
- Corporate Tax Rate
- VAT Rate & Filing Frequency
- Labour Laws in Nigeria
- Conclusion: Expanding Smoothly into Nigeria
Overview: Doing Business in Nigeria
Nigeria remains a leading destination for international investors thanks to its large population, rich natural resources, and dynamic business climate. The government has made significant reforms to simplify corporate registration, taxation, and immigration procedures, making it easier for foreign entities to operate legally.
Immigration in Nigeria
Nigeria immigration is a crucial aspect for anyone looking to settle or work here.
All foreign nationals seeking to work or reside in Nigeria must comply with the Nigeria Immigration Service (NIS) regulations. Depending on the purpose of stay and duration, various visa categories and permits apply.
What work authorization is required?
Foreign nationals employed in Nigeria require:
e-CERPAC (Combined Expatriate Residence Permit and Aliens Card)
Employers are expected to justify that the role cannot be filled locally.
How long is the work permit valid?
The e-CERPAC is valid for one year and renewable annually for the duration of the employment. Employers must keep records of expatriate staff and renew permits before expiry to avoid fines or deportation risks.
The regulations surrounding Nigeria immigration have far-reaching implications if cuaght or ahead to
Can dependents accompany expatriates?
Yes. Spouses and children of expatriates can apply for Dependent CERPACs or residence permits. However, dependents are not allowed to work unless they secure their own work authorization.
For detailed guidance, you can explore the Nigeria Immigration Service – Expatriate Services page.
Tax in Nigeria
Nigeria’s tax system is managed by the Federal Inland Revenue Service (FIRS) for federal taxes and various State Internal Revenue Services (SIRS) for state-level taxes. All companies operating in Nigeria must register for a Tax Identification Number (TIN) and comply with filing deadlines.
Understanding Nigeria immigration laws is vital for tax compliance.
What is Nigeria’s corporate tax rate?
Businesses must be aware of Nigeria immigration requirements for foreign employees.
The standard Corporate Income Tax (CIT) rate in Nigeria is 30% for large companies (earning over ₦100 million annually).
- Medium-sized companies (₦25–₦100 million annual turnover): 20%
- Small companies (less than ₦25 million annual turnover): 0%
Nigeria immigration affects corporate tax rates for expatriates.
This tiered structure supports small and medium enterprises while ensuring larger corporations contribute proportionately.
How much is VAT in Nigeria?
The current Value Added Tax (VAT) rate is 7.5%, applied to most goods and services. Some essential items such as basic food products, medical services, and educational materials are exempt. Businesses must register for VAT, collect it from customers, and remit it monthly to the FIRS.
How frequently are taxes filed?
- VAT Returns: Monthly
- PAYE (Pay-As-You-Earn): Monthly through State Internal Revenue Services
- Corporate Income Tax: Annually
- Withholding Tax: Monthly
Non-compliance with Nigeria immigration regulations can lead to penalties.
Non-compliance attracts penalties, and the FIRS has intensified digital monitoring through the TaxPro Max Portal to improve transparency and efficiency.
Labour Laws in Nigeria
Nigeria’s employment framework is guided by the Labour Act, Cap L1, Laws of the Federation of Nigeria 2004. It sets out minimum employment standards for wages, contracts, leave, termination, and employee welfare.
What is the standard notice period for termination?
The Nigeria immigration landscape is constantly evolving, requiring regular updates.
Under the Labour Act:
- Less than 3 months of service: 1 day notice
- 3 months to 2 years: 1 week notice
- 2 to 5 years: 2 weeks notice
- 5 years or more: 1 month notice
Employers and employees may agree to longer periods in their contracts, provided they meet or exceed the statutory minimum.
What statutory benefits apply?
Employers must register employees for social insurance through the Nigeria Social Insurance Trust Fund (NSITF) and contribute to the National Housing Fund and Pension Scheme managed by the National Pension Commission (PenCom).
Key contributions include:
- Pension: Employer 10%, Employee 8%
- NSITF: 1% of monthly payroll
- Health Insurance: through the National Health Insurance Authority (NHIA)
Employees are also entitled to paid annual leave, sick leave, and maternity leave of at least 12 weeks with full pay.
Conclusion
Nigeria’s business environment offers immense potential but understanding its regulatory framework is essential for smooth operations. From obtaining the right work permits to meeting tax obligations and complying with labour laws, every step requires careful management.
At Kharis Petroleum Resources & Investments Ltd., we support global companies entering African markets with offshore business expansion and HR support. Our team assists with immigration compliance, payroll, taxation, and workforce management — ensuring you remain fully compliant while focusing on growth.
📩 Contact us today to simplify your expansion into Nigeria and across Africa.
