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
Before paying a Nigerian contractor, get an invoice that names both parties, describes the work and period, and states the amount, currency and payment details, then keep it with the payment confirmation. HMRC requires a UK company to keep records of all money spent, including invoices and contracts, for six years from the end of the financial year they relate to, and can fine £3,000 for not keeping them.
What the law asks a UK company to keep
GOV.UK's guidance on company and accounting records (updated 29 January 2025) says a limited company must keep records of all money it spends and receives, giving receipts, orders, invoices and contracts as examples, along with bank statements and correspondence. Records are kept for six years from the end of the last company financial year they relate to, longer in some cases (for example where a transaction covers more than one accounting period or HMRC has opened a compliance check). HMRC can fine £3,000, or a director can be disqualified, for not keeping accounting records.
Paying through an app does not change any of that. The app's payment confirmation proves money left your account; the invoice and contract prove what it was for.
What the contractor's invoice should show
| Item | Why it matters |
|---|---|
| Contractor's full legal name and address (or business name) | Shows who was paid, and matches the account name |
| Your company's legal name and address | Ties the cost to your company, not to you personally |
| Unique invoice number and date | Stops duplicates and fixes the date for your records |
| Description of the work and the period covered | Supports the cost as a business expense |
| Amount and currency | The figure you will pay, in the currency agreed |
| Payment details | The account the contractor wants paid, in their own name |
| VAT position | Whether Nigerian VAT is charged and why (see below) |
| Contract or purchase order reference | Links the invoice to the agreed scope and rate |
Ask for the same layout every month. A contractor who changes their bank details on an invoice should confirm the change by another channel before you pay; payment diversion fraud often starts with a doctored invoice, as covered in invoice fraud and email compromise.
VAT on both sides
Nigerian VAT
Under the Nigeria Tax Act 2025, exported services are zero-rated (PwC Worldwide Tax Summaries, reviewed 29 May 2026). A contractor in Lagos supplying work to your UK company should therefore not normally be adding 7.5% Nigerian VAT. Separately, small businesses with turnover of ₦100 million or less and fixed assets of ₦250 million or less are exempt from VAT registration and charging, though professional service providers are excluded from that exemption (Forvis Mazars, 16 March 2026). If an invoice does include Nigerian VAT, ask why before paying it.
UK VAT
If your company is VAT-registered and the contractor's service is a general-rule business-to-business service, HMRC's VAT Notice 741A (sections 5.1, 5.2 and 5.6) says you account for VAT yourself under the reverse charge: output tax in box 1, the same amount as input tax in box 4 if you can recover it, and the net value in boxes 6 and 7. If you are not registered, section 5.7 says the value of such services counts towards the registration threshold. More detail is in the UK reverse charge on Nigerian services.
When the contractor is an individual with no business set-up
Plenty of contractors are individuals who have never issued an invoice. That is fine, but do not accept a WhatsApp message as the record. Send them a simple template with the fields in the table above, and ask for a PDF each month. Check that the name on the invoice matches the name on the receiving account; a mismatch is the most common reason a payment is held or queried. If they ask you to pay a relative's account, decline politely and ask for an account in their own name, because your record then shows a payment to someone you have no contract with. For a larger team, the same template feeds paying many contractors at once.
Recording the exchange rate
If the invoice is in naira or dollars and your books are in pounds, record the amount in the invoice currency, the sterling amount that left your account and the rate used. Keep the app's confirmation showing all three. When the rate on the invoice date and the rate on the payment date differ, your accountant will treat the difference as an exchange gain or loss; the method is covered in FX gains and losses.
A monthly checklist
- Contract in place, with rate, scope and payment terms.
- Invoice received in the agreed format, checked against the contract.
- Bank details match previous invoices, or the change has been confirmed by phone.
- Payment approved by someone other than the person who received the invoice, where the team is big enough.
- Payment confirmation saved next to the invoice, with the rate and fee.
- Both filed where your accountant can find them for six years or more.
Where Pryme fits
Pryme partners with VerifyDoc.ai so any customer can generate a regular or a verifiable receipt or statement, and anyone can check that a verifiable one is genuine and unaltered, which is useful when an auditor or a contractor asks for proof of payment. In a Pryme Business Account, the Finance agent can match invoices to payments and flag gaps, and payments wait for a person's approval above the ceiling you set.
Questions people ask
Does a Nigerian contractor need to give me an invoice?
There is no single rule that forces the contractor to, but your company needs records of what it paid and why, so make an invoice a condition of payment in the contract.
How long should a UK company keep contractor invoices?
GOV.UK says six years from the end of the last financial year they relate to, longer in some cases, such as when HMRC opens a compliance check.
Should a Lagos contractor charge me Nigerian VAT?
Exported services are zero-rated under the Nigeria Tax Act 2025, per PwC's summary, so a Lagos contractor serving a UK company should not normally add 7.5% VAT. Ask if one does.
Is an app payment confirmation enough as a record?
It proves the payment but not what it was for. Keep the invoice and contract with it.
Sources
- GOV.UK: Running a limited company, company and accounting records (updated 29 Jan 2025) · accessed Oct 2026
- HMRC VAT Notice 741A: Place of supply of services (sections 5.1 to 5.10) · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, other taxes incl. VAT (reviewed 29 May 2026) · accessed Oct 2026
- Forvis Mazars: 2025 Nigeria Tax Act, VAT key business changes (16 Mar 2026) · 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.