Banks to report accounts with N25m quarterly turnover to tax agency - Taiwo Oyedele

Taiwo Oyedele, chairman of the presidential fiscal policyand tax reforms committee, says the tax reform laws will mandate commercialbanks to report accounts with N25 million quarterly turnover to the tax agency. Speaking on Friday during a media parley on the tax reformlaws, Oyedele said the tax reforms increased the reporting threshold from N10million to N25 million. “What this one has done is that it has raised the thresholdfor reporting your bank account. I think it was N10 million before, but it isnow N25 million, which translates to N100 million,” he said. He said on January 13, 2020, the Finance Act introduced arequirement for individuals and businesses to connect their tax identificationnumber (TIN) to bank accounts “if you are using it for business or for anyincome, like a salary earner”. Since then, Oyedele said some individuals and businesses hadbeen complying with the directive. He said this requirement of “putting TIN in your businessaccount” is one of the reforms his committee considered, “so we moved it to thenew laws”. “But because the level of tax awareness in Nigeria is sopoor, people are finding out so many things for the first time,” Oyedele said. “They just assume that the new tax law is introducing them.This one is actually not.” Clarifying his statement in a chat with TheCable, Oyedelesaid “the context is that the current tax law already requires the filing ofcustomer’s information by banks to the tax authority while the new lawprescribes a mandatory disclosure for threshold of N25m per quarter (for anindividual) and N100m (for a company) under the new law”. ‘BANKS, CBN, FIRS HAVE NO AUTHORITY TO UNILATERALLY WITHDRAWFUNDS FROM CUSTOMERS’ ACCOUNTS’ Oyedele said no authority has the power to deduct moneydirectly from individuals’ bank accounts. “Even if you have N1 billion in the account, nobody candebit your bank account. That’s why I took you through the process of, ifyou’re not paying your taxes, they write to you, write back, you do finalassessment, conclusive, and then you go to court, and then it’s a longprocess,” Oyedele said. “I have been in this space for three decades. I have notseen — the power, which is in the law — one instance where they have used it inNigeria before.” The tax expert said contrary to claims, neither the FederalInland Revenue Service (FIRS), the Central Bank of Nigeria (CBN), banks, norany other government agency has the authority to unilaterally withdraw fundsfrom personal or business bank accounts. “No one has the power to debit your account. In the law,there is what we call power of substitution. In some countries, they will saygarnishee order,” he said. “This is the order where if the money you earn is plenty,let’s say if you have like N200 million tax to pay, the taxman can go throughthe stress of sending your assessment, your debt to go to court to determinewho is right. “He can say ‘pay’, the court said you should pay. You refuseto pay. They say, but you have money in your account.” Oyedele added that after such a court order has beenobtained, the bank is informed that the affected party owes some amount ofmoney to the government and has refused to pay. “That’s the extreme case when they use it. It will not applyto anyone that I know in Nigeria,” he said. “But you cannot remove that power from the law because itmay become necessary, right? “So I think the message to all Nigerians is nobody is takingany amount from their bank account. Whether their bank account has 50k or 50million, nobody is taking anything from the bank account.” On September 9, the federal government gazetted Nigeria’snew tax reform laws, with implementation set to begin on January 1, 2026.

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