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
Your personal income tax goes to the revenue service of the state where you are resident: LIRS in Lagos, FCT-IRS in Abuja and RIRS in Rivers State. The Nigeria Tax Act 2025, in force from 1 January 2026, sets the rates and makes the first ₦800,000 of annual chargeable income tax-free, but collection stays with the state. If you move mid-year, tell your employer and both revenue services so you are not taxed twice.
Many people who move from Lagos to Abuja, or from Abuja to Port Harcourt, keep paying tax the old way until something goes wrong, usually when they need a tax clearance certificate for a visa, a contract or a loan. The cities have different revenue services, and knowing which one is yours avoids gaps and double payment.
The basic rule: residence decides
Income tax on individuals is charged under federal law, but for most residents it is collected by the state. The deciding factor is where you are resident. As KPMG's commentary on itinerant workers explains, collection depends on the territory in which an individual is deemed resident, and the residence criteria carry over into the Nigeria Tax Act 2025. In plain terms:
- If you live in Lagos and work in Lagos, LIRS collects your tax.
- If you live in Abuja, FCT-IRS collects it, whichever district or area council you live in.
- If you live in Port Harcourt or elsewhere in Rivers State, RIRS collects it.
- Companies are different: company income tax goes to the federal Nigeria Revenue Service (formerly FIRS), not the state.
For employees, your employer deducts PAYE and remits it to the revenue service of the state where you live. If your employer has offices in all three cities, it should remit to different states for different staff.
What the 2026 rules changed, and what they did not
The Nigeria Tax Act 2025 took effect on 1 January 2026. Under it the first ₦800,000 of annual chargeable income falls in a 0% band, and employment income is exempt where a person earns the national minimum wage or less. The bands above that apply in every state, so a person on the same salary pays the same tax in Lagos, Abuja or Port Harcourt. Our guide to PAYE tax bands for 2026 works through the numbers, and rent relief explains a deduction many renters miss.
What did not change is which office you deal with. State levies, development levies and local charges still vary, and each revenue service runs its own portal, its own tax clearance process and its own requirements for self-assessment.
The three revenue services compared
| Lagos | Abuja (FCT) | Port Harcourt | |
|---|---|---|---|
| Revenue body | Lagos State Internal Revenue Service (LIRS) | FCT Internal Revenue Service (FCT-IRS) | Rivers State Internal Revenue Service (RIRS) |
| Who it collects from | Lagos residents, including self-employed | Residents of the six FCT area councils | Rivers State residents |
| Personal income tax rates | National bands under the Nigeria Tax Act 2025 | Same national bands | Same national bands |
| Local charges on top | State and local government levies | Area council levies, for example AMAC | State and local government levies |
Because portals and requirements change, use the revenue service's own website or office to confirm what to file and when.
Moving between cities in the middle of the year
This is where most problems start. A rough guide:
- Tell your employer your new address and the date you moved, in writing.
- Ask HR which state they will remit to from that date, and get it on your payslip.
- Keep payslips and remittance evidence for the months in each state.
- If you are self-employed, register with the new state's revenue service and file self-assessment there for income earned after the move.
- If you need a tax clearance certificate, ask the new state how it treats the months paid to the old one.
Where a worker splits time across several states, PITA has a specific definition of an itinerant worker, someone who works in more than one state for at least 20 days in at least three months of the year, and a state may give credit for tax already paid elsewhere, capped at the amount paid. If your work takes you back and forth between Lagos and Port Harcourt, ask a tax adviser how your case is treated.
Common mistakes when people move
- Assuming the old state's tax ID or records follow you automatically. Each revenue service keeps its own register.
- Leaving self-assessment until a certificate is needed, then having to reconstruct a year of income.
- Paying area council or market levies in cash without a receipt, then being asked to pay again.
- Forgetting that rent relief and other deductions must be claimed with evidence, wherever you live.
Worked example
Illustrative figures. Ngozi earns ₦6,000,000 a year and moves from Yaba to Gwarinpa on 1 July. Her total tax for the year is the same either way because the bands are national. What changes is the split: January to June should go to LIRS and July to December to FCT-IRS. If her employer keeps remitting to Lagos all year, Abuja has no record of her, and she may struggle to get an FCT tax clearance certificate later. Fixing it in month one is far easier than in month thirteen.
Where Pryme fits
Self-employed people need clean records to file self-assessment in a new state. A Pryme account keeps income and spending in one place, and you can generate verifiable statements, issued with VerifyDoc.ai, when a revenue office or lender asks for proof. Our guide to tax for sole proprietors covers what to file.
Questions people ask
Do I pay tax to Lagos or Abuja if I live in Abuja but my company is in Lagos?
Personal income tax follows residence, so as an Abuja resident your PAYE should go to FCT-IRS, even if your employer is registered in Lagos.
Is tax higher in Lagos than in Port Harcourt?
Personal income tax rates are national, so the same income attracts the same income tax. Other state and local levies can differ.
What is RIRS?
RIRS is the Rivers State Internal Revenue Service, which collects personal income tax and state revenues from Rivers State residents, including Port Harcourt.
How do I get a tax clearance certificate after moving to Abuja?
Apply to FCT-IRS. Have payslips or self-assessment records for the period you have lived in the FCT, and evidence of tax paid to your previous state for the rest of the year.
Sources
- Navigating the tax landscape for itinerant workers in Nigeria (KPMG via Mondaq) · accessed Oct 2026
- Understanding personal income tax under the Nigeria Tax Act 2025 · 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.