A Step-by-Step Guide for Self-Employed Professionals
Freelancing is growing rapidly in Nigeria, with thousands of designers, writers, developers, consultants, and digital professionals working independently. But while freelancing offers freedom, many freelancers struggle with tax compliance, especially filing Personal Income Tax (PIT) correctly.
Whether you work full-time as a freelancer or earn side income, the law requires you to pay tax on your earnings. Filing your Personal Income Tax does not have to be difficult — and with the right guidance, you can stay compliant, avoid penalties, and enjoy peace of mind.
This guide from Faturoti Taiwo & Co. explains everything you need to know.
1. Do Freelancers Need to Pay Personal Income Tax in Nigeria?
Yes — freelancers are classified as self-employed individuals under Nigerian tax law.
This means your income is taxable under the Personal Income Tax Act (PITA).
You must file and pay tax to the tax authority of the state where you live, usually:
- LIRS – Lagos Internal Revenue Service
- Oyo IRS, Ogun IRS, Rivers IRS, etc.
Freelancers are required to:
✔ Register as a taxpayer
✔ File annual tax returns
✔ Pay tax based on their assessable income
2. What You Need Before Filing Your Personal Income Tax
Before you can file your PIT, you need:
✔ A Tax Identification Number (TIN)
If you don’t have one, you must apply through your state tax office or online portal.
✔ Records of all income earned
This includes:
- Bank transfers from clients
- Cash payments
- Remittances from platforms like Fiverr, Upwork, Paystack, etc.
✔ Receipts and proof of business expenses
Some expenses can be deducted to reduce your tax.
✔ A simple financial summary
Your accountant can help you prepare an income and expense summary.
3. How to File Your Personal Income Tax as a Freelancer (Step-by-Step)
Here is the filing process simplified:
Step 1: Register with Your State Tax Authority
Visit your State Internal Revenue Service (SIRS) office or portal to register as a taxable individual.
You will be issued a TIN and registered under the Self-Assessment scheme.
Step 2: Prepare Your Annual Income Statement
You must calculate:
- Total income earned in the year
- Allowable business expenses
- Net assessable income
Allowable expenses may include:
✔ Internet & data
✔ Software subscriptions
✔ Workspace or home office costs
✔ Transportation for business
✔ Equipment (laptops, tools, etc.)
✔ Marketing expenses
Proper documentation is essential.
Step 3: Complete the Annual Tax Return Form
Your state revenue office provides a Personal Income Tax Return (Form A).
You must fill in:
- Your income
- Your expenses
- Your tax calculation
- Your personal details
This must be done on or before 31 March every year.
Step 4: Pay the Tax Due
Once your tax is assessed, you’ll receive a payment reference.
You can pay through:
- Bank transfer
- Remita
- Online tax portals
- State IRS payment channels
Keep your payment receipt for your records.
Step 5: Collect Your Tax Clearance Certificate (TCC)
Once payment is confirmed, you can request your TCC, which is required for:
- Visa applications
- Government contracts
- Loan applications
- Business registration updates
- Proof of tax compliance
4. Common Mistakes Freelancers Make (Avoid These!)
Many freelancers unknowingly break tax rules. Here are common mistakes:
❌ Not filing annual returns
❌ Mixing personal and business expenses
❌ Not keeping receipts
❌ Underreporting income
❌ Not maintaining proper books
❌ Waiting until tax authorities issue penalties
FIRS and state IRS systems are now digital — making non-compliance easier to detect.
5. Benefits of Filing Your Taxes as a Freelancer
Filing your PIT is not just a legal obligation — it benefits you:
✔ Builds your financial credibility
✔ Allows you to obtain a TCC easily
✔ Helps you secure loans or investments
✔ Keeps you off penalty lists
✔ Helps you maintain proper business records
✔ Improves your chances for grants and global opportunities
6. How Faturoti Taiwo & Co. Can Help Freelancers
We make the tax filing process simple, accurate, and stress-free.
Our services include:
- Personal Income Tax filing
- TIN registration
- Annual returns preparation
- Expense documentation
- Tax planning to reduce liabilities
- Ongoing compliance monitoring
- Audit support
- Financial record-keeping solutions
With our support, you stay compliant and avoid penalties — while focusing on your craft and clients.
Filing your Personal Income Tax as a freelancer in Nigeria doesn’t have to be confusing.
With the right records, proper planning, and professional guidance, you can:
✔ Stay compliant
✔ Reduce your tax bill
✔ Maintain a clean financial profile
✔ Grow your freelance career confidently
Don’t wait until tax season becomes stressful. Begin early — and let Faturoti Taiwo & Co. handle the heavy lifting.