Tax reform bill explained: What students, freelancers, and informal workers need to know

Nigeria just did a massive tax system remix, like updating from Windows 98 straight to Windows 11 overnight.

We're talking about major tax laws like the Nigeria Tax Act 2025 and the Nigeria Tax Administration Act 2025 entering the chat.

But before you roll your eyes and say, "Na government matter, no concern me," hold up. This isn't just another boring policy gist for big men in suits.

These new tax reforms are shaking things up for everyone, from campus side hustlers selling thrift and wigs to part-time jollof vendors and tech bros freelancing from their mama's parlour. The whole idea? To stop Nigeria's revenue waka-waka and get serious about collecting tax the smart way.

But while the big companies will be dealing with boardroom-level drama, the real tea is how this new tax era will hit the streets, especially students, informal workers, and small-time hustlers who've been vibing under the radar.

In this explainer, we break down how the new tax rules will affect you, your hustle, your pocket and why that "small" POS charge might just become your new taxman in disguise. Let's unpack it, no boring grammar, just straight to the point.

Key Impacts on Students, Part-Timers, and Informal Workers

1. Mandatory Tax Identification Number (TIN) and Registration

The Nigeria Tax Administration Act, 2025, emphasises the issuance and use of a Tax Identification Number (TIN) for every "taxable person." 

This means that even students engaged in part-time work or individuals earning income through informal means will likely be required to obtain a TIN.

The Act defines an "individual" broadly, encompassing a single person or a body of individuals, which covers most scenarios for students and informal workers.

So, let’s say you’re a student at UNILAG who also does weekend ushering jobs or sells thrift clothes (okrika) on Instagram, you now fall under the category of “taxable person.”

The same applies to the 22-year-old barber in Abuja or the 25-year-old makeup artist in Ibadan. As long as money dey enter your account for services rendered, dem go expect you to register and get a TIN.

The objective is to facilitate tax compliance, suggesting a push for greater inclusion of all income earners into the tax net.

2. Taxation of Income and Simplified Returns

The Nigeria Tax Act, 2025, now officially includes income from part-time jobs and gigs. So, if you're a 400-level student who also tutors WAEC students for pay, or you’re coding websites for small businesses in your area, your income now qualifies as “employment income” and can be taxed.

But don’t panic, there’s good news for small earners.

For informal workers, like your cousin who runs a small laundry service in Mushin or the lady in your estate who sells homemade zobo, the law introduces something called “presumptive taxation.”

That means instead of calculating every kobo you made, tax authorities can estimate your income and charge you a small, fixed amount, making things simpler.

Also, if your income is low (details to come), you can file a “simplified annual income tax return.” So, no need to start hiring accountants or worrying about complicated tax language, just basic info, and you’re good.

3. Development Levy and Other Taxes

A new “Development Levy” is now part of the package. While we’re still waiting to see how much this levy will be, it basically means one more tax, even if you’re just running your hustle from home.

For instance, if you’re a student who also works as a freelance photographer, this levy may apply depending on how the regulations are implemented.

Also, everyday transactions like buying a phone online, paying for Netflix, or ordering food from Bolt Food could include Value Added Tax (VAT), so even if you’re not “officially” working, your spending is still taxed.

Stamp duties are another consideration; if you sign an agreement with someone to manage their social media or handle an event, you may need to stamp that document and pay a duty.

4. Tax Administration and Enforcement

The new laws also create a new sheriff in town: the Nigeria Revenue Service (NRS). They’ll work with the Joint Revenue Board and the Tax Appeal Tribunal to ensure taxes are paid properly.

They also set up an Office of the Tax Ombud, basically a tax complaints office. If the system messes up your records or you’re wrongly taxed, you can file a complaint and have your matter reviewed.

Just know that non-compliance now comes with penalties. So if you fail to get a TIN or don’t file returns when required, you could be fined, even if you’re just selling sneakers from your hostel.

Bottom line? Whether you're flipping thrift items on WhatsApp, offering makeup services in Lekki, or doing remote data entry jobs from Abeokuta, the tax system is now watching.

But instead of fearing it, use the new simplified options to your advantage. Stay woke, get your TIN, and avoid gbas gbos with the tax authorities.