Nigeria is Africa's largest economy, and its registration system has gone genuinely digital in the last few years. The one number every foreign founder needs to know upfront: any company with foreign participation must be capitalized at 100 million naira, a hundred times the minimum for a purely local company. Here's what it takes to start a business in Nigeria in 2026.
1. Which business structure fits you?
Before you register anything, it helps to know what you're actually choosing between.
- Business Name (sole proprietorship or partnership). Cheap and quick, but has no separate legal personality, so your personal assets are exposed if the business is sued or runs up debt.
- Private Limited Company (Ltd). The standard for almost every foreign subsidiary and startup, needing at least one director and one shareholder. It creates a corporate veil that shields personal or parent-company assets, and it's the only structure that supports foreign ownership and serious banking relationships.
2. Register your business
Registration runs through the CAC (Corporate Affairs Commission) online portal. A purely local company needs minimum share capital of 100,000 naira; a company with any foreign participation must be capitalized at 100,000,000 naira (100 million), a genuinely significant step up worth planning your structure around. Total DIY cost for a private company runs around 27,000 naira in 2026, though foreign-owned companies also pay stamp duty (0.75% of share capital, so 750,000 naira on a 100 million naira capitalization) and a CAC filing fee of 60,000 to 150,000 naira depending on the share capital band. There's no residency requirement for directors or shareholders, but you'll need a Nigerian address for registration documents. Certificates of Incorporation are typically issued within 48 hours of a properly completed filing.
3. Get your TIN
Your Tax Identification Number is now largely auto-generated alongside CAC registration, issued by the Nigeria Revenue Service (NRS), which replaced the Federal Inland Revenue Service (FIRS) in 2026 as part of the broader Nigerian Tax Act 2025 reforms. Without it, your company can't fully interact with Nigeria's financial and regulatory systems.
4. Check licenses and permits
Nigeria doesn't issue a single national business license. What you need depends on your industry; foreign-owned businesses hiring non-Nigerian staff also need a Business Permit and Expatriate Quota from the Federal Ministry of Interior.
5. Understand Nigerian taxes
Corporate Income Tax runs up to 30% for standard companies, but small companies with annual revenue under 25 million naira pay a genuinely lighter 0.5% turnover tax instead, a meaningful simplification worth checking if your revenue qualifies. Sole proprietors pay personal income tax progressively from 7% to 24%. VAT is 7.5%, and the 2025 tax reforms broadened zero-rated and exempt items, introduced input-VAT credits, and rolled out mandatory e-invoicing obligations for VAT-registered businesses, build that into your accounting setup from the start. Withholding Tax applies as an advance payment on qualifying transactions, credited against your final liability.
6. Stay compliant
Annual returns filing with the CAC is required to keep your company in good standing, a step founders often overlook until it causes problems. Financial statements are due within 18 months of incorporation and within 42 days after your Annual General Meeting. Employers register for PAYE, NHIS (National Health Insurance Scheme), and pension contributions under PENCOM guidelines.
Nigeria business costs at a glance
| Item | Cost |
|---|---|
| Local company minimum share capital | ₦100,000 |
| Foreign-participation minimum share capital | ₦100,000,000 |
| Private company DIY registration cost | ~₦27,000 |
| Corporate Income Tax, standard | Up to 30% |
| Small company turnover tax (under ₦25M revenue) | 0.5% |
| VAT, standard rate | 7.5% |
Frequently asked questions
How much capital do I need for a foreign-owned company in Nigeria?
100,000,000 naira, a hundred times the 100,000 naira minimum for a purely local company.
What's the corporate tax rate in Nigeria?
Up to 30% for standard companies, though small companies with annual revenue under 25 million naira pay a much lighter 0.5% turnover tax instead.
How much does it cost to register a private company in Nigeria?
Total DIY cost runs around 27,000 naira in 2026, though foreign-owned companies also pay stamp duty and a CAC filing fee that scales with share capital.
What's the VAT rate in Nigeria?
7.5%, with 2025 tax reforms rolling out mandatory e-invoicing obligations for VAT-registered businesses.
What replaced Nigeria's Federal Inland Revenue Service in 2026?
The Nigeria Revenue Service (NRS), part of the broader Nigerian Tax Act 2025 reforms.
Fees and rates above come from the Corporate Affairs Commission (CAC) and Nigeria Revenue Service (NRS) as of 2026, and they do change over time, so double check before you file. None of this is legal or tax advice. Talk to a Nigeria-qualified accountant or lawyer about your specific situation.