Crypto Traders — Your Tax Obligations Under NTA 2025

Crypto is Taxable in Nigeria

Let's be direct: cryptocurrency transactions are taxable under the Nigeria Tax Act 2025. Whether you're trading Bitcoin on Binance, earning USDT for freelance work, or receiving airdrops — there are tax consequences^[1].

This guide covers everything Nigerian crypto users need to know.

Two Types of Crypto Tax

1. Income Tax (When You Earn Crypto)

If you receive cryptocurrency as payment for goods or services, it's treated as income and taxed under the NTA 2025 income tax brackets^[2].

Taxable crypto income includes:

Crypto received as payment for freelance work

Staking rewards

Yield farming / DeFi returns

Mining rewards

Airdrops (taxed at fair market value when received)

How to calculate:

Determine the NGN value of the crypto at the time you received it (using CBN rates for NGN/USD, then market price for crypto/USD)

This is your gross income from that receipt

Include it in your total annual income

Apply NTA 2025 brackets

Example:

You receive 0.05 BTC for a design project on March 15

BTC price on March 15: $60,000 → 0.05 BTC = $3,000

CBN rate on March 15: ₦1,550/$

Taxable income: ₦4,650,000

2. Capital Gains Tax (When You Sell/Trade Crypto)

When you dispose of a crypto asset, Capital Gains Tax (CGT) applies to any profit^[3].

What counts as a disposal:

Selling crypto for fiat (NGN, USD, etc.)

Swapping one crypto for another (BTC → ETH, ETH → USDT)

Using crypto to purchase goods or services

Gifting crypto above a threshold

What does NOT count as a disposal:

Transferring between your own wallets

HODLing (no tax until you sell)

CGT rate: 10% on net capital gains

How to Calculate Capital Gains

Step 1: Determine Your Cost Basis

This is what you paid to acquire the crypto, including:

Purchase price at time of acquisition

Exchange fees paid to buy

Network/gas fees for the acquisition transaction

Step 2: Determine Your Proceeds

What you received when you disposed of the crypto:

Sale price in NGN (or converted to NGN via CBN rate)

Minus: exchange fees and network fees for the sale transaction

Step 3: Calculate the Gain

Gain = Proceeds – Cost Basis

Step 4: Use FIFO Method

When you have multiple purchases at different prices, use First In, First Out (FIFO):

The first coins you bought are deemed to be the first ones sold

This determines which cost basis to use

Example:
DateTransactionAmountPrice (NGN)

Jan 15Buy 1 BTC1 BTC₦90,000,000
Mar 20Buy 0.5 BTC0.5 BTC₦50,000,000
Jun 10Sell 0.8 BTC0.8 BTC₦80,000,000

FIFO calculation for the 0.8 BTC sale:

0.8 BTC comes from the Jan 15 purchase (first in)

Cost basis: 0.8 × ₦90,000,000 = ₦72,000,000

Proceeds: ₦80,000,000

Capital gain: ₦8,000,000

CGT at 10%: ₦800,000

Crypto-to-Crypto Swaps

This is where it gets tricky. Every swap is two taxable events:

You "sell" the crypto you're giving up (potential capital gain)

You "buy" the crypto you're receiving (establishes new cost basis)

Example: Swapping 1 ETH for 0.05 BTC

Disposal of 1 ETH at current market value → calculate gain/loss

Acquisition of 0.05 BTC at current market value → this becomes your cost basis for future disposal

DeFi, Staking, and Yield

Staking rewards: Taxed as income at the market value when received. The received tokens have a cost basis equal to the income recognized.

Liquidity provision: Adding tokens to a liquidity pool may trigger a disposal. Removing them establishes a new cost basis. Fees/rewards earned are income.

Token swaps via DEX: Same as crypto-to-crypto swaps — each is a taxable disposal.

NFTs

Buying an NFT: Not a taxable event for the buyer (unless you used appreciated crypto to buy it — that's a disposal of the crypto).

Selling an NFT: The profit is a capital gain, subject to 10% CGT.

Receiving an NFT as payment: Treated as income at fair market value.

Record-Keeping Requirements

This is the hardest part. You need records of^[4]:

Every purchase: Date, amount, price, fees, exchange used

Every sale/swap: Date, amount, proceeds, fees

Every receipt: Date, amount, market value, source

Wallet addresses for all your holdings

Exchange account statements

Records must be kept for 6 years (NTAA Section 31).

Practical tips:

Export transaction history from every exchange (Binance, Quidax, Luno, etc.)

Save screenshots of DeFi transactions

Use a dedicated crypto tracking tool alongside TaxJeje

Don't wait until filing season — reconcile monthly

What About the CBN Crypto Ban?

The CBN lifted the ban on crypto transactions in December 2023^[5]. Banks can now process crypto-related transactions. However:

Crypto exchanges are not yet formally regulated in Nigeria

P2P transactions are legal

Tax obligations exist regardless of regulatory status — if you made a gain, you owe tax

Penalties for Non-Compliance

The NRS can detect crypto activity through:

BVN-linked bank account monitoring (deposits from exchanges)

International data sharing agreements

Exchange reporting requirements

Penalties for not declaring crypto income/gains are the same as for any unreported income — ₦100,000 for late filing, plus potential fraud charges for deliberate underreporting^[6].

Action Steps

Export all your exchange transaction histories for 2026

Calculate your total crypto income (payments, staking, airdrops)

Calculate capital gains on all disposals using FIFO

Include both in your annual tax return

Keep records for 6 years

TaxJeje supports BTC, ETH, USDT, and USDC income tracking, with automatic CBN rate conversion.

Start Tracking Your Crypto Tax →

---

References

References

1. Nigeria Tax Act 2025 - Digital assets and cryptocurrency provisions
2. Fourth Schedule, NTA 2025 - Income tax brackets apply to crypto income
3. Capital Gains Tax Act (as amended by NTA 2025) - 10% CGT rate
4. Section 31, NTAA 2025 - 6-year record retention requirement
5. CBN Circular - Lifting of Crypto Banking Restrictions, December 2023
6. Section 83, NTAA 2025 - Penalties for false declaration