Fokona Latest Questions

Iphy
Asked: 2026-04-01T05:02:46+00:00 In:

Do I Pay Both Personal Income Tax and Company Income Tax in Nigeria If I Own a Limited Liability Company?

As an individual that has a “limited liability company”, do you file both your personal income tax and your company’s income tax, separately?

company's income taxpersonal ncome taxtax

You must login to add an answer.

Need An Account,

2 Answers

  2. Ochoyoda
    Community Builder

    Yes — you must file both separately if you own a Limited Liability Company. This is because you and your company are legally two different entities. Why You Must File Both Under Nigerian tax laws: You (Individual) → Pay Personal Income Tax (PIT) Your Company (Limited Liability) → Pay Company IncomeRead more

    Yes — you must file both separately if you own a Limited Liability Company.

    This is because you and your company are legally two different entities.

    Why You Must File Both

    Under Nigerian tax laws:

    You (Individual) → Pay Personal Income Tax (PIT)

    Your Company (Limited Liability) → Pay Company Income Tax (CIT)

    These are governed by different laws:

    Personal Income Tax Act → For individuals

    Companies Income Tax Act → For companies

    1. Your Personal Income Tax (PIT)

    You file Personal Income Tax if you receive:

    Salary from your company

    Director’s allowance

    Dividends (in some cases)

    Any personal income

    You file this with:

    Your State Internal Revenue Service

    Example:

    If you live in Lagos → File with Lagos State Internal Revenue Service

    If you live in Rivers → File with Rivers State IRS

    2. Your Company Income Tax (CIT)

    Your Limited Liability Company must file:

    Company Income Tax (CIT)

    Annual returns

    VAT (if applicable)

    Withholding Tax (if applicable)

    These are filed with: 👉 Federal Inland Revenue Service (FIRS)

    Simple Example

    Let’s say:

    Your Company earns → ₦10,000,000

    You pay yourself salary → ₦1,200,000

    You must:

    Company pays tax on ₦10,000,000 → Company Income Tax

    You pay tax on ₦1,200,000 → Personal Income Tax

    Important (Many People Miss This)

    Even if:

    Your company did not make profit

    You still must file:

    Company returns (zero return)

    Otherwise:

    You may face penalties

    Summary

    Type

    Who Files

    Where To File

    Personal Income Tax

    You

    State IRS

    Company Income Tax

    Your Company

    FIRS

    See less
  3. Onyx_WiseFidafa
    Starter

    Of course, you must file them separately. Legally, a Limited Liability Company is a "person" distinct from you, its owner. Therefore, you both have separate tax obligations. The Dual-Filing System Feature,                   Personal Income Tax (PIT),            Company Income Tax (CIT) Who it's for,Read more

    Of course, you must file them separately. Legally, a Limited Liability Company is a “person” distinct from you, its owner. Therefore, you both have separate tax obligations.

    The Dual-Filing System

    Feature,                   Personal Income Tax (PIT),            Company Income Tax (CIT)
    Who it’s for,               You (the individual/Director),                 Your Company (the business                                                                                                                    entity)
    Tax Authority,           “State IRS (e.g., LIRS for Lagos)”,           FIRS (Federal level)
    Income Source,         Your salary, allowances, or dividends,    Business profits and revenue
    Governing Law,        Personal Income Tax Act (PITA),             Companies Income Tax Act                                                                                                                        (CITA)

    Key Rules to Remember

    • Separate Wallets: If your company earns ₦1M and pays you a ₦100,000 salary, the company is taxed on its earnings at the FIRS, and you are taxed on your salary at the State IRS.
    • Zero Profit ≠ Zero Filing: Even if your company made no money this year, you must still file a “Nil Return” with the FIRS to avoid heavy penalties.
    • Different Deadlines:
    • *        Personal: Usually due by March 31st.
    •          Company: Usually due within 6 months of the company’s financial year-end.

    Why this distinction matters

    • No “Double Counting”: Your salary is a “deductible expense” for the company. This means the company doesn’t pay tax on the ₦100,000 it gave you; instead, you pay the tax on that portion as an individual.
    • Legal Protection: Keeping these filings separate maintains your “Corporate Veil.” If you treat the company’s money as your personal pocket and fail to file separately, you risk losing the legal protection that a Limited Liability Company provides.

    The “Golden Rule”
    Even if you are the only person in the company, you must still wear two hats:

    • The Director: Filing for the company at the FIRS.
    • The Individual: Filing for yourself at the State IRS.

    The Bottom Line
    Because a Limited Liability Company is a separate legal entity, “mixing” these taxes is a major compliance error. You must file Personal Income Tax where you live and Company Income Tax at the federal level.

    Goodluck!

    See less

Related Questions