The Lagos State Internal Revenue Service (LIRS) has warned employers in the state to comply with statutory tax filing requirements ahead of the January 31 deadline, stressing that late or non-compliance will attract stiff penalties under existing tax laws.
The Director of Personal Income Tax at LIRS, Mr Ayodele Adebayo, issued the warning during an interview on Thursday, noting that January is a critical period in the tax calendar, particularly for employers required to file annual Pay As You Earn (PAYE) returns.
He explained that the Nigeria Tax Administration Act (NTAA), 2025, mandates employers to submit annual returns detailing all employees engaged in the preceding year, including those who have exited service.
“January is a very critical month for tax compliance. Employers are required to file comprehensive annual returns covering all employees engaged during the year,” Adebayo said.
According to him, employers must submit their annual PAYE schedules, showing employees’ earnings, taxes deducted and remitted, as well as monthly returns for tax deductions at source, in line with Section 28 of the NTAA.
Adebayo emphasised that the statutory deadline for filing is January 31 each year, warning that penalties apply for late or non-filing. He cited Section 101 of the Act, which prescribes a penalty of ₦100,000 for the first month of default and ₦50,000 for each subsequent month the failure continues, even where PAYE payments have been fully remitted.
“Filing is a legal obligation, not optional,” he said.
He added that proper filing is essential for employees to obtain Tax Clearance Certificates, noting that all employees’ details must be included, regardless of whether they worked for the full year or part of it.
While employers file PAYE returns on behalf of their staff, Adebayo clarified that individuals are still required to file personal tax returns to qualify for tax clearance.
He listed corporate organisations, entrepreneurs, sole proprietors, and government ministries, departments and agencies operating in Lagos as employers required to comply with the filing obligations. He also noted that tax filing is guided by residency, meaning employers must remit taxes to Lagos State for employees resident in the state, irrespective of where the organisation’s headquarters is located.
On compliance levels, Adebayo disclosed that about 10,000 companies have started the filing process so far, with over 7,000 completing it successfully, while about 2,000 were flagged for incomplete or incorrect submissions. He said LIRS is targeting more than 35,000 companies and urged employers not to wait until the last minute.
He also reiterated that annual returns must now be filed exclusively through the LIRS digital platform, as manual submissions are no longer accepted.
“The process is fully digital, and employers can file from their offices using the LIRS portal. The templates are already provided to ease compliance,” he said.
Adebayo advised employers to file early to avoid sanctions and system congestion, adding that timely and accurate tax filing promotes transparency and supports effective government planning and service delivery.
