Lagos Reminds Residents: File Your Tax Returns Before March 31 or Face Penalties

Speaking in an interview, the agency explained that every taxable resident in Lagos is legally required to file an annual return, regardless of whether they owe additional tax or not. This obligation cuts across employees, freelancers, business owners, and individuals earning from multiple income streams.

An individual annual tax return is essentially a formal declaration of all income earned in the previous year, alongside any deductions or reliefs. It allows the tax authority to determine a taxpayer’s accurate tax position.

The agency clarified that even individuals whose employers already deduct Pay-As-You-Earn tax are still required to file returns. PAYE, it explained, is only an advance payment system and does not replace the filing obligation. This means employees must also declare other income sources such as rent, side businesses, or investments.

For those who earned little or no income during the year, filing is still mandatory. In such cases, a nil return can be submitted to show that no tax is due.

The deadline for submission remains March 31, and missing it can be costly. Defaulting taxpayers risk a penalty of ₦100,000 for the first month and ₦50,000 for every additional month of delay. Beyond fines, persistent failure to settle confirmed tax liabilities could trigger enforcement measures, including the use of third parties such as banks or business associates to recover outstanding debts.

First-time filers are advised to obtain a Tax Identification Number, gather relevant income records, identify allowable deductions, and complete their returns through the official tax portal. Required documents typically include salary records, bank statements, financial statements for business owners, rent receipts, and evidence of investment income or deductible expenses.

The directive also extends to freelancers, content creators, and gig workers, whose earnings from digital platforms and online businesses must be fully disclosed. Similarly, retirees with additional income streams and individuals who changed jobs within the year are expected to file returns to reconcile all earnings.

Importantly, filing a tax return does not automatically mean paying more tax. It simply determines what is accurately owed based on actual income. The process itself is free and can be completed online.

Taxpayers who make errors during filing are encouraged to submit amended returns or voluntarily disclose mistakes. The agency also warned residents to be vigilant against scams, stressing that legitimate tax authorities do not request payments through unofficial channels.

Beyond compliance, the tax body emphasised the broader impact of taxation, noting that revenue generated supports critical sectors such as infrastructure, healthcare, education, and transportation. According to officials, consistent tax compliance plays a key role in sustaining public services and improving living standards across Lagos.