How to File VAT Returns in Nigeria: Complete Step-by-Step Guide

Filing VAT returns is a monthly obligation for all VAT-registered businesses in Nigeria. This comprehensive guide walks you through the entire process, from understanding what goes into your return to filing it successfully with the Nigeria Revenue Service (NRS), formerly known as FIRS.

Understanding VAT Returns in Nigeria

A VAT return is a declaration of your business's VAT transactions for a specific period. In Nigeria, VAT returns are filed monthly and include:

• Output VAT: The VAT you collected from customers on your sales
• Input VAT: The VAT you paid on your business purchases
• Net VAT Payable: Output VAT minus Input VAT (if positive, you owe NRS)

The current VAT rate in Nigeria is 7.5%, applicable to most goods and services unless specifically exempted or zero-rated.

VAT Return Filing Deadline

VAT returns in Nigeria must be filed by the 21st of the month following the transaction period.

Transaction Month	Filing Deadline
January	February 21st
February	March 21st
March	April 21st
...	...
December	January 21st

Important: If the 21st falls on a weekend or public holiday, the deadline remains the same—you should file before the holiday.

What You Need Before Filing

1. Sales Records

• All invoices issued during the month
• Total taxable sales (standard-rated at 7.5%)
• Zero-rated sales (exports, etc.)
• Exempt sales (if any)

2. Purchase Records

• VAT invoices from suppliers
• Receipts for business expenses with VAT
• Import documentation showing VAT paid

3. Supporting Documents

• Bank statements for payment verification
• Customs documentation for imports
• Export documentation for zero-rated supplies

Calculating Your VAT Return

Step 1: Calculate Output VAT

Add up all the VAT you charged customers during the month.

Example:

Description	Net Sales	VAT (7.5%)
Product A sales	₦1,000,000	₦75,000
Service B revenue	₦500,000	₦37,500
Total Output VAT	—	₦112,500

Step 2: Calculate Input VAT

Add up all the VAT you paid on business purchases.

Example:

Description	Net Cost	VAT Paid
Office supplies	₦200,000	₦15,000
Professional services	₦100,000	₦7,500
Equipment purchase	₦300,000	₦22,500
Total Input VAT	—	₦45,000

Step 3: Calculate Net VAT Payable

Net VAT = Output VAT - Input VAT

Using our example:

• Net VAT = ₦112,500 - ₦45,000 = ₦67,500 payable

If Input VAT exceeds Output VAT, you have a VAT credit that can be:

• Carried forward to the next month
• Refunded (in limited circumstances)

Step-by-Step Online Filing Process

Method 1: NRS TaxPro Max Portal

Step 1: Log In to TaxPro Max

1. Visit taxpromax.firs.gov.ng
2. Enter your Tax Identification Number (TIN)
3. Enter your password
4. Complete two-factor authentication if enabled

Step 2: Navigate to VAT Returns

1. From the dashboard, click "File Returns"
2. Select "VAT" from the tax type dropdown
3. Select the return period (month/year)

Step 3: Complete the Return Form

Fill in the following sections:

Section A: Taxpayer Information (auto-populated)

• Company name
• TIN
• VAT Registration Number

Section B: Output Tax

• Standard-rated supplies (7.5%)
• Zero-rated supplies
• Exempt supplies
• Total Output VAT

Section C: Input Tax

• Local purchases
• Imported goods/services
• Total Input VAT

Section D: Tax Computation

• Net VAT payable or (credit)

Step 4: Upload Supporting Documents

Attach relevant documents:

• Sales schedule
• Purchase schedule
• Bank statements (if required)

Step 5: Submit the Return

1. Review all entries for accuracy
2. Click "Submit Return"
3. Save the acknowledgment receipt
4. Note the payment reference number

Method 2: Filing via Bank

Some banks allow VAT payment and filing at their branches:

1. Complete NRS Form VAT 002
2. Visit your bank with the form
3. Make payment
4. Bank submits the return on your behalf
5. Keep the bank receipt as proof

Making VAT Payments

After filing, you must remit the net VAT payable:

Payment Channels

1. Online via TaxPro Max

• Generate payment reference
• Pay via card or bank transfer

1. Bank Payment

• Use the payment reference from filing
• Pay at any NRS-designated bank

1. USSD Payment

• Dial the NRS USSD code
• Follow prompts for VAT payment

Payment Deadline

VAT payment must be made by the 21st of the month (same as filing deadline).

Common Mistakes to Avoid

1. Missing the Deadline

Late filing attracts penalties. Set reminders for the 15th to start preparing your return.

2. Incorrect VAT Calculation

Double-check your calculations. A 7.5% rate on ₦100,000 is ₦7,500, not ₦750 or ₦75,000.

3. Claiming Ineligible Input VAT

You cannot claim input VAT on:

• Purchases for exempt supplies
• Entertainment expenses (with exceptions)
• Goods/services not used for business

4. Not Keeping Proper Records

Without proper invoices, you cannot claim input VAT. Ensure all VAT invoices contain:

• Supplier's VAT number
• Invoice date and number
• Description of goods/services
• VAT amount clearly stated

5. Filing Nil Returns Late

Even if you have no transactions, you must file a nil return by the deadline.

How Finora Automates VAT Filing

Finora transforms VAT filing from a monthly headache into a simple, automated process:

Automatic VAT Calculation

Every time you create an invoice or record an expense in Finora, the VAT is automatically calculated and categorized. No spreadsheets, no manual calculations.

Real-Time VAT Dashboard

See your current month's VAT position at a glance:

• Total Output VAT collected
• Total Input VAT paid
• Net VAT payable
• Comparison with previous months

One-Click VAT Returns

When it's time to file:

1. Click "Generate VAT Return"
2. Review the auto-populated form
3. Download in NRS-compliant format
4. Submit to TaxPro Max

Finora generates the exact format required by NRS (Formerly FIRS), eliminating manual data entry and reducing errors.

Filing Reminders

Never miss a deadline. Finora sends you:

• 7-day advance reminder
• 3-day advance reminder
• Day-of reminder if not filed

Complete Audit Trail

Every transaction is recorded with:

• Date and time
• User who made the entry
• Original document reference
• VAT treatment applied

This makes NRS audits stress-free.

Frequently Asked Questions

What if I file late?

Late filing attracts a penalty of ₦5,000 per month or 5% of VAT due (whichever is higher), plus interest at the prevailing CBN rate.

Can I amend a filed return?

Yes, you can file an amended return if you discover errors. Contact NRS (Formerly FIRS) or use the TaxPro Max portal to submit corrections. Note that underpayments will attract interest.

What if I have no transactions this month?

You must still file a nil return by the deadline. Failure to file—even with no activity—attracts penalties.

How long should I keep VAT records?

Keep all VAT records for at least 6 years from the end of the accounting period to which they relate.

Can I claim input VAT on imports?

Yes, VAT paid on imports can be claimed as input VAT. You'll need the customs documentation showing VAT payment.

Conclusion

Filing VAT returns doesn't have to be complicated. With proper record-keeping and a systematic approach, you can file accurately and on time every month. Understanding the process, meeting deadlines, and avoiding common mistakes will keep your business compliant and penalty-free.

Finora makes this even easier by automating calculations, generating NRS-compliant returns, and providing timely reminders. Let technology handle the complexity while you focus on your business.

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