So you’ve launched your business, got your CAC registration, and the sales are coming in steadily. But there’s one thing you’ve probably been dodging — taxes.

We get it. It’s not the sexiest topic. But if you plan to run a legit business in Nigeria (or anywhere else), filing your annual tax returns is not optional.

Let’s unpack why.

First off, what are Annual Tax Returns?

Your annual tax return is a summary of your income, expenses, and taxes for the year. It tells the government:

• How much your business made.
• How much you should be taxed.
• If you paid enough tax already or still owe.
• If you’re eligible for a refund.

You file it every year, even if your business made zero naira or ran at a loss. Yes — even “small small” businesses.

Why Should You Bother Filing It?

1. It’s the Law. Period.

Filing tax returns is a legal requirement under Nigerian tax laws (FIRS for companies, State IRS for individuals). Dodging it can land you in trouble faster than a fake alert.

👉 Penalty alert: You could be fined up to ₦50,000 for a company and ₦5,000 for individuals per year of failure — and it adds up.

2. It Builds Credibility With Banks and Investors

You want a loan? Grant? Investor interest? First thing they’ll ask: “Can we see your tax clearance certificate?”

Filing your returns is how you qualify. No tax clearance = no money for you.

3. You Might Be Owed a Refund

Let’s say you overpaid during the year or qualified for a tax exemption you didn’t know about. Filing your returns is how you claim that money back.

👉 No returns, no refund. Government won’t call you.

4. It Helps You Understand Your Business Better

Filing tax returns forces you to organize your accounts. You’ll know your revenue, expenses, and actual profit — not just vibes and WhatsApp balance screenshots.

👉 It’s like financial therapy for your business.

5. It Keeps You On the Right Side of EFCC and FIRS

If your business suddenly blows and you start making big money, FIRS will notice. If you’ve been filing consistently? You’re good.
If you’ve been ghosting? You might have to answer some uncomfortable questions — and nobody wants wahala from tax people.

6. It’s Easier Than You Think (If You Do It Right)

Whether you’re a freelancer, small business, or limited company, there are now registered tax consultants and online platforms that help you file without headache.

👉 Don’t wait till the deadline when the site is down and everyone is panicking on Twitter.

So… Is It a Necessity?

YES. Whether you’re a side-hustler, SME, or startup founder — annual tax returns are your business’s seatbelt.
You may not feel like you need it today, but when things go left, you’ll be glad you buckled up.

✅ Filing tax returns is a legal requirement
✅ It opens doors to loans, grants, and partnerships
✅ It helps you grow a clean, investable business
✅ Not filing could cost you far more than you think