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Explainer: A Comprehensive Framework of the Tax ID

Published

3 weeks ago

September 12, 2025

By Arabinrin Aderonke

In recent debates about Nigeria’s tax reforms, a widespread misconception has taken root: that citizens without a Tax Identification Number (TIN) cannot own or operate a bank account. This view, while popular in some quarters, is inaccurate.

The reality is that Nigeria’s tax system has evolved to integrate seamlessly with existing national registries, ensuring that every eligible individual or entity is automatically identifiable for tax purposes.

This article clarifies how the new framework works, drawing from the Federal Inland Revenue Service’s (FIRS) implementation of the National Taxpayer Directory under the Nigeria Tax Administration Act (2025).

What is a Tax ID?
The Tax Identification Number (TIN) is a 13-digit unique identifier for all taxable persons and entities in Nigeria. It encodes details such as issuance year, registry source (NIN for individuals, RC for corporates), state of registration, and a cryptographic fragment for security, ending with a check digit.

The TIN is not a standalone requirement imposed on citizens. Instead, it is a statutory tool that ensures every taxpayer, whether an individual, a registered business, or an association, can be uniquely verified within the national tax system.

Tax ID and the National Identity Management Commission, NIMC: For individuals, the TIN is automatically linked to their National Identification Number (NIN) issued by the National Identity Management Commission (NIMC).

When an individual provides their NIN, such as during bank account opening or Know Your Customer (KYC) processes, the system cross-checks the NIN in the national database. As part of this verification, the TIN is automatically retrieved and attached to the person’s records.

This means citizens do not need to manually apply for or present a tax ID before opening a bank account. The system handles the integration in real time.

Tax ID and the Corporate Affairs Commission, CAC: For businesses, the TIN is tied directly to the RC Number issued by the Corporate Affairs Commission (CAC). Likewise, for cooperatives, partnerships, professional bodies, and other legal entities, the TIN is connected to their respective recognised registries.

This linkage ensures that corporate entities can be transparently identified for both tax and compliance purposes. Just as with individuals, banks and regulators do not require extra documentation beyond the foundational registry numbers to confirm tax status.

Exploring the Benefits of Tax ID: Seamless Banking Access: Individuals and businesses can open and operate bank accounts using their NIN or RC Number, with the TIN automatically integrated behind the scenes

Fraud Reduction: The system eliminates duplicate or false identities by ensuring every taxpayer is tied to a verifiable registry.

Regulatory Compliance: Banks and financial institutions can rely on a single, consent-driven source of truth for onboarding, reporting, and KYC compliance.

Inclusivity: Beyond companies, the framework extends coverage to associations, professional bodies, and trustees.

Global Compatibility: Nigeria’s tax system can securely interact with international systems for trade, finance, and compliance.

The misconception that Nigerians can not own or operate a bank account without a tax ID overlooks the integrated design of the new TIN system. By linking TINs to existing foundational identifiers such as the NIN and RC Number, the system ensures automatic compliance without creating unnecessary barriers for citizens.

In practice, this means a Nigerian walking into a bank with their NIN is already tax-compliant. The bank simply retrieves their TIN as part of its onboarding process. Far from being a hurdle, the TIN framework is a gateway to financial inclusion, regulatory transparency, and global interoperability in Nigeria’s evolving digital economy.

Arabinrin Aderonke Atoyebi is the technical assistant on broadcast media to the executive chairman of the Federal Inland Revenue Service.

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Featured

Nigeria’s Historic Bid for the 2030 Commonwealth Games: A Call for National and Global Support

Published

6 days ago

September 30, 2025

The Gleamer

Joel Ajayi

Nigeria is poised to make history as it seeks to host the Centenary Commonwealth Games in 2030, a monumental opportunity that promises to transform the nation’s economy, infrastructure, and global standing.

More than a sporting spectacle, the Games would serve as a catalyst for development across multiple sectors, leaving behind a legacy of national pride and sustainable growth.

The benefits of hosting the Games extend far beyond the sports arena. Nigeria stands to gain both empirical and non-empirical advantages, with direct, indirect, and induced impacts that will touch every corner of society. Infrastructural development will take center stage, with new facilities such as indoor sports halls, conference centers, and improved road networks reshaping urban landscapes while strengthening the nation’s capacity to host future international events.

Economic growth is another significant dividend. Over 10,000 jobs are expected to be created, spanning construction, facility management, event planning, and tourism services.

The hospitality industry will undergo major improvements as hotels and resorts are upgraded to meet international standards, while local restaurants, lounges, and tourist attractions will see a surge in patronage from international visitors. Small and medium enterprises, particularly in the transport, finance, and food service sectors, will become some of the greatest beneficiaries, as the Games generate new demand and expand opportunities for local businesses.
The Commonwealth Games will also accelerate the growth of Nigeria’s sports industry.

Investments in training facilities, coaching, and talent development will inspire a new generation of athletes, ensuring long-term benefits that extend beyond 2030, a major focus of the President Bola Tinubu administration.
At the same time, the process of preparing for the Games will create opportunities for Nigerians to learn new crafts, acquire technical skills, and engage in global-standard event management, thereby strengthening human capacity and innovation across industries.

Mallam Shehu Dikko, Chairman of the Nigeria Sports Commission, and Hon. Bukola Olopade, the Director General, have been widely recognized for their tireless and visionary leadership in repositioning Nigeria’s sporting sector.

Their commitment to facilitating infrastructural development and strengthening grassroots sports development has laid the foundation for Nigeria’s bold bid to host the 2030 Commonwealth Games. Under their leadership, the NSC is fostering strategic partnerships and driving innovation in sports administration, they have demonstrated the nation’s readiness to stage an event of such global magnitude.

Beyond the tangible gains, the hosting of the 2030 Commonwealth Games carries profound symbolic value. It would be a moment of unity and pride, a chance for Nigeria to showcase its cultural richness, resilience, and excellence to the world.
As a centenary edition, the Games would stand as a historic milestone not just for the Commonwealth but for Nigeria itself, cementing its place on the global stage as a capable, ambitious, and forward-looking nation.

The gains from hosting the Commonwealth Games can never be undermined or overemphasized. This is Nigeria’s time to step forward and show the world our resilience, and excellence. We call on every Nigerian, across sectors and communities, to support this noble aspiration.

Nigeria’s pursuit of the 2030 Commonwealth Games is a vision for transformation, a blueprint for national development, and a legacy project that will inspire generations to come.

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