Vendor Success Guide

Tax Guide for Online Vendors

Understanding your tax obligations is essential for sustainable business growth. This guide explains what you owe as a Nigerian online vendor.

Personal income tax (individual sellers)

If you sell as an individual (no CAC registration), your earnings are personal income. Pay-As-You-Earn (PAYE) for employed individuals, direct assessment for self-employed. Rates: 7-24% depending on income bracket. Most state Inland Revenue Boards handle this.

Company income tax (registered businesses)

If your business is CAC-registered as Limited Liability Company, file annual returns. Tax rates: 0% for businesses earning under ₦25M (Micro), 20% for ₦25M-100M (Small), 30% above ₦100M.

Value Added Tax (VAT) — 7.5%

VAT registration mandatory if annual sales exceed ₦25,000,000. Below this threshold, registration is voluntary. Once registered, charge 7.5% VAT on sales, claim VAT on business purchases, file monthly returns.

Record-keeping with PBridge

PBridge provides downloadable transaction history showing every sale, commission, refund, and payout. This serves as your sales records for tax purposes. Save these monthly. Consult a Nigerian accountant for proper filing.

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FAQ

Should I register CAC business immediately?

Not necessarily. Individual selling is fine while you're under ₦5M annual sales. Register when you hit ₦5-10M/year for better tax treatment and business credibility.

Does PBridge withhold tax from my earnings?

No — you receive your full net payout (sale minus commission). You're responsible for your own tax filings.