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
Nigeria treats a foreign digital business as having a significant economic presence (SEP), and so a taxable presence, if it earns ₦25 million or more from Nigeria in a year, uses a .ng domain or Nigerian web address, or purposefully and sustainably engages Nigerian users, for example by pricing in naira, according to PwC's summary reviewed May 2026. For a UK company, whether that charge bites also depends on the UK–Nigeria tax treaty, which limits Nigeria to profits attributable to a permanent establishment.
A UK software, streaming, marketplace or online-course business can have thousands of Nigerian customers without a desk in Lagos. Nigeria's significant economic presence rules were written for exactly that situation. This guide sets out the tests as current summaries describe them, what follows if you meet one, and where the UK treaty changes the picture.
The three tests
PwC's Nigeria summary says a foreign digital entity is deemed to have an SEP if it meets any one of these:
- Revenue. Income of ₦25 million, or the equivalent in other currencies, from Nigeria in a year. Activities of connected persons are added together.
- Domain. It uses a .ng domain or registers a Nigerian web address.
- Targeting. It purposefully and sustainably engages Nigerian persons, for example by showing prices in naira.
Revenue counted includes streaming or downloads, data collected about Nigerian users, goods or services supplied directly or through a platform, and intermediation between Nigerian suppliers and customers. WTS Blackwoodstone notes that the Nigeria Tax Act itself does not state a threshold and that the ₦25 million figure comes from the 2020 SEP Order, so check whether the NRS has issued anything newer before relying on the number.
What the tests mean in practice
- A UK course platform that shows naira prices at checkout may meet the targeting test even if Nigerian revenue is small.
- ₦25 million is a naira figure. If you invoice in pounds, convert at a documented rate and keep the working, because the naira value of the same sales changes as the exchange rate moves.
- Group companies selling into Nigeria are counted together.
If you have an SEP
The profit attributable to the SEP is taxable. PwC says that where it cannot be determined, profit is deemed to be the company's profit margin applied to its Nigerian income, and the tax payable must be at least the withholding tax deducted, or 4% of Nigeria-generated income where no WHT applies. The 4% development levy does not apply to non-resident companies.
Worked example
Example only. A UK SaaS company earns the equivalent of ₦80 million from Nigerian customers in a year and its group margin is 15%. Deemed profit is ₦80 million × 15% = ₦12 million. At 30%, tax would be ₦3.6 million. If no WHT had been deducted, the minimum on PwC's description is 4% × ₦80 million = ₦3.2 million, so the higher figure, ₦3.6 million, would apply. The actual outcome depends on the treaty point below and on NRS practice.
The UK treaty question
Under Article 7 of the UK–Nigeria Double Taxation Convention, a UK enterprise's business profits are taxable only in the UK unless it carries on business in Nigeria through a permanent establishment, as the treaty defines it. PwC frames the nexus charge in terms of non-residents that are not tax resident in a treaty country. A UK-resident company with no treaty PE therefore has an argument that SEP alone does not allow Nigeria to tax its business profits. That argument needs evidence of UK residence, usually an HMRC certificate (see HMRC certificate of residence), and advice on how the NRS treats such claims.
Withholding tax from Nigerian business customers
Nigerian companies that pay a UK firm may deduct withholding tax before paying. PwC's withholding tax summary (reviewed May 2026) gives 10% for non-residents on commission, consultancy, technical, management and professional fees, and 5% on other services, and says WHT on those fees to a non-resident company is a final tax. Whether a SaaS subscription falls into one of those categories, or into royalties, depends on the contract. Ask Nigerian customers for the WHT receipt each time: it is your evidence of tax paid and, on PwC's description of the SEP minimum, it can be the floor for the Nigerian liability. Keep receipts with the invoice they relate to.
VAT is a separate question
SEP is about income tax. Nigerian VAT on digital services follows its own rules: PwC says non-resident suppliers of taxable services to Nigerian customers must register and account for VAT, and WTS notes that VAT-registered Nigerian business customers self-account. The treaty does not cover VAT. Our guide to Nigerian VAT for UK digital sellers goes through registration.
What to check first
- Total your Nigerian revenue for the year, in naira, across connected companies.
- Check your domains and whether you show naira prices.
- Confirm your UK tax residence and get evidence of it.
- Ask whether Nigerian customers are deducting WHT from your invoices.
- Review VAT registration separately.
Where Pryme fits
If you collect naira from Nigerian customers, holding it in a dedicated balance makes the Nigerian revenue total easy to evidence. A Pryme Business Account holds NGN with local account details alongside GBP, USD and EUR (business multicurrency), and Swap shows the rate and fee before you approve a conversion (business Swap).
Questions people ask
What is significant economic presence in Nigeria?
A rule that treats a foreign digital business as having a taxable presence if it earns ₦25 million or more from Nigeria in a year, uses a .ng domain, or targets Nigerian users, per PwC's May 2026 summary.
Does showing prices in naira trigger SEP?
PwC gives naira pricing as an example of purposeful and sustained engagement with Nigerian persons, which is one of the three tests.
Does the UK–Nigeria treaty protect a UK digital company?
Article 7 limits Nigerian tax on business profits to those attributable to a treaty permanent establishment, which gives UK-resident companies an argument; take advice on how the NRS applies it.
Is SEP the same as Nigerian VAT on digital services?
No. VAT has separate registration rules for non-resident suppliers, and the tax treaty does not cover VAT.
Sources
- PwC Worldwide Tax Summaries: Nigeria, taxes on corporate income (reviewed 29 May 2026) · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, corporate residence (reviewed 29 May 2026) · accessed Oct 2026
- Mondaq (WTS Blackwoodstone): Taxation of digital activities under the Tax Reform Acts 2025 (11 Mar 2026) · accessed Oct 2026
- GOV.UK: UK-Nigeria Double Taxation Convention (in force text) · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, other taxes (reviewed 29 May 2026) · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, withholding taxes (reviewed 29 May 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.