Overview
On September 24, 2026, the Federal Ministry of Finance announced the Nigeria Tax Administration (Interest on Late Payment of Tax) Order 2026. It took effect on October 1, 2026, and replaces the 2017 notice on interest on unpaid taxes.
For naira liabilities, interest now accrues at the Central Bank of Nigeria (CBN) Monetary Policy Rate (MPR) plus one percentage point, down from the previous five-point spread. For foreign currency liabilities, it accrues at Secured Overnight Financing Rate (SOFR) plus six. The Order also introduces a floor based on the 364-day Treasury Bill yield, fixes the rate monthly, and applies simple interest daily. The 10% penalty for late payment remains, as does the power to waive penalty or interest for good cause.
This insight examines the regulatory objective behind the Order, the key provisions taxpayers need to understand, and the practical steps for recomputing open liabilities, tracking the monthly Nigeria Revenue Service (NRS) rate notice, and reviewing contracts that incorporate statutory late-payment rates.
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