The Lagos State Internal Revenue Service (LIRS) has intensified efforts to recover outstanding tax liabilities, warning employers, banks, business operators, and tax agents to comply strictly with the enforcement provisions of the Nigeria Tax Administration Act (NTAA) 2025.
Eko Hot News reports that the new enforcement measure applies where a taxpayer has failed to settle an established and final tax liability when due, despite previous notifications.
LIRS disclosed that the taxes covered under the enforcement include Personal Income Tax, Capital Gains Tax, Stamp Duties, and Withholding Tax administered by the Service.
According to the agency, substitution directives may be served on banks and other financial institutions, employers, tenants, debtors, customers, agents, or business partners of the defaulting taxpayer.
The Service explained that any individual or organisation owing money to, or holding funds on behalf of a tax defaulter, may be legally required to remit the specified amount directly to LIRS.
LIRS stated that once a substitution notice is served, the affected party must deduct and remit the stated sum from funds belonging to or payable to the taxpayer.
It clarified that any amount recovered through substitution would be treated as tax paid to the extent of the sum remitted.
The agency warned that failure to comply with a substitution notice constitutes an offence under the NTAA 2025.
LIRS stressed that such non-compliance may attract sanctions as provided by law.
The Service further noted that banks and financial institutions are expected to remit required amounts promptly and confirm compliance through the LIRS e-Tax platform.
Where necessary, financial institutions may also be required to provide details of the taxpayer’s account balances and disclose any existing encumbrances.
LIRS reiterated its commitment to enforcing tax laws fairly and ensuring that all eligible taxpayers meet their statutory obligations.
The Service urged stakeholders to cooperate fully to avoid penalties and enforcement actions.
