Nigerian banks will start deducting a 10 percent withholding
tax on interest earned from foreign currency deposits from January 1, 2026.
Access Bank, in an email to customers on Wednesday, outlined the changes that will take effect from the specified date.
The financial institution stated that the deduction aligns with the Nigerian Tax Act, 2025.
“Electronic Money Transfer Levy (N50): Previously charged to
the Recipient on transfers of N10,000 or more, this charge will now be deducted
from the Sender’s account,” the email reads.
“Withholding Tax on Foreign Currency Deposits Interest:
Interest earned on FCY deposits will now attract a 10% withholding tax.
“Please be assured that all applicable taxes will be duly
remitted to the Federal Government in line with regulatory requirements.”
On October 29, the Nigeria Revenue Service (NRS), formerly
Federal Inland Revenue Service (FIRS), directed banks to deduct withholding tax
from all interest payments on short-term investment securities.
The agency said the tax must be deducted from interests
payable to any person, including non-corporate entities, on the date of
payment.
On December 30, President Bola Tinubu said implementation of
the tax reform laws will commence as scheduled on January 1, 2026.
In a statement, Tinubu said the reforms are a
once-in-a-generation opportunity to build a fair, competitive, and robust
fiscal foundation, and they are not designed to raise taxes.
Source: Banks to begin 10% withholding tax deduction on foreign currency deposits interest Jan 1
