AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
From 1 January 2026, the Nigeria Tax Act 2025 allows VAT-registered businesses to claim input VAT on services and fixed assets used to make taxable supplies, not only on goods, with claims to be made within five years and apportionment where costs serve both taxable and exempt activity. The VAT rate stays at 7.5%. An AI finance agent can capture input VAT on every eligible purchase, apply your apportionment and track credits and refund windows; eligibility decisions stay with you and your tax adviser.
What changed
Under the old VAT Act, input VAT recovery was generally limited to goods bought for resale or used directly in producing taxable goods. Forvis Mazars' summary of the Nigeria Tax Act 2025 sets out the main changes for input VAT:
- Input VAT is claimable on services and fixed assets used to make taxable supplies.
- It applies to taxable supplies made from 1 January 2026.
- Claims must be made within five years of the relevant tax period.
- Where costs serve both taxable and exempt activities, input VAT must be apportioned.
- Input VAT on exempt supplies remains non-claimable.
- Excess input VAT becomes a credit; unused credits can be refunded if requested within 12 months, and the NRS is to process refunds within 30 days.
The VAT rate remains 7.5%. The Act also exempts small businesses, defined by Forvis Mazars as those with annual turnover of ₦100 million or less and total fixed assets not over ₦250 million, excluding professional service providers, from VAT registration, charging, filing and remittance. Our explainer Does a small business in Nigeria have to charge VAT? covers that in more detail.
Why this matters for cash
For a business that pays VAT on rent, professional fees, software, logistics or equipment, the change can reduce the VAT it pays over each month. But the money only comes back if each purchase is documented and claimed. Input VAT that is not captured at the time is easy to lose, especially across many small service bills.
What a finance agent can track
| Task | Agent | Person |
|---|---|---|
| Capture input VAT on each bill | Records VAT on goods, services and fixed assets with the invoice | Confirms unclear items |
| Taxable or exempt use | Tags each cost by the activity it serves, using your rules | Sets the rules and the apportionment method |
| Apportionment | Applies the agreed method to shared costs | Reviews the result each period |
| Five-year window | Tracks unclaimed input VAT by period | Decides on late claims |
| Credits and refunds | Tracks credit balance and the 12-month refund window | Decides whether to request a refund or set off |
| Supplier invoices | Checks VAT is shown and supplier details are complete | Follows up disputes with suppliers |
A worked example
Example figures only. An Abuja private hospital group makes some taxable supplies, such as a pharmacy café and car parking, and some exempt ones, such as medical services. In March 2026 it pays VAT on several costs.
- The agent records ₦1.2m of input VAT on a new generator, ₦450,000 on IT support and ₦300,000 on cleaning services.
- It tags the café's coffee machine servicing (₦60,000 VAT) as wholly taxable, so fully claimable.
- The generator, IT and cleaning serve the whole site. Using the apportionment method the finance lead agreed with the adviser, based on the share of taxable turnover, say 12%, the agent calculates claimable input VAT of 12% × ₦1.95m = ₦234,000.
- Total claimable input VAT for March is ₦294,000. The rest is not claimable because it relates to exempt supplies.
- The agent records the method, the percentage and the source documents, so the claim can be explained if the NRS asks.
The apportionment method is the key judgement, and it belongs to the business and its adviser, not the agent.
Records to keep
A wider right to recover input VAT brings closer attention to the evidence behind each claim. For every claim, keep the supplier's invoice showing VAT separately, proof of payment, a note of which activity the cost serves and, for shared costs, the apportionment calculation for that period. For fixed assets, keep the purchase documents for as long as the asset is in use and the claim could be reviewed. Exported services raise their own VAT questions; see Do Nigerian businesses charge VAT to foreign clients?.
If your business is below the small business threshold and exempt from VAT, it will generally not be charging output VAT or claiming input VAT. Whether opting out of the exemption makes sense, for example because your customers are VAT-registered businesses, is a question for your adviser.
Practical steps
- Ask suppliers to show VAT separately on every invoice, with their tax ID.
- Agree an apportionment method in writing before the first return of the year.
- Review the credit balance monthly and decide early whether to request a refund.
- Prepare for e-invoicing, which will make supplier invoice data more structured. See Nigeria e-invoicing on the NRS MBS.
Where Pryme fits
Pryme Business holds NGN alongside USD, GBP and EUR; Naira deposits are held by Solid Allianze Microfinance Bank, licensed by the CBN. The Finance agent records every bill with its source and runs the month-end close, and the Compliance agent tracks filing obligations. Read small company tax under the Nigeria Tax Act 2025 for the wider changes.
Questions people ask
Can I claim input VAT on services in Nigeria now?
Under the Nigeria Tax Act 2025, input VAT on services and fixed assets used to make taxable supplies is claimable for taxable supplies made from 1 January 2026, according to Forvis Mazars' summary. Confirm with your adviser.
What is the VAT rate in Nigeria under the 2025 Act?
It remains 7.5%. A proposed phased increase was not adopted.
What if my business makes both taxable and exempt supplies?
Input VAT on shared costs must be apportioned, and input VAT relating to exempt supplies is not claimable. Agree the method with a tax adviser.
How long do I have to claim input VAT?
Forvis Mazars reports that claims must be made within five years of the relevant tax period. Unused credits can be refunded if requested within 12 months.
Sources
- Forvis Mazars: VAT and Nigeria 2025 tax reforms, key changes · accessed Oct 2026
- Mondaq (The Trusted Advisors): Tax reform in Nigeria, key changes under new tax acts · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.