الرواتب في نيجيريا: نشاط محصور بأصحاب الصفة

Nigeria is West Africa's largest labour market and also the one with the most fragmented tax and social architecture. A foreign company must grasp from the outset that wage tax is not a federal tax: withholding falls to the state in which the employee resides, and that determines which administration receives the payments and the returns.

Social protection is similarly divided. The mandatory pension scheme, supervised by the National Pension Commission (PenCom), rests on individual accounts opened with a licensed administrator that the employee selects personally. Work injury cover is provided by the Nigeria Social Insurance Trust Fund (NSITF), and a separate contribution funds the Industrial Training Fund (ITF) for vocational training.

Salaries are paid in naira, in an exchange control environment that makes remuneration in foreign currency awkward to arrange. English is the official language and the language of contracts.

Accountancy for third parties is regulated, with one distinctive feature: the country has two statutory professional bodies, ICAN and ANAN, either of which may license a practice.

Registration with the tax authority of the state where the employee will work conditions the lawfulness of wage withholding, and it is the step that files prepared abroad miss most often. A company employing across several states will have several counterparties to manage, on top of federal tax registration.

No lasting employment is possible, upstream of all this, without a local structure registered with the Corporate Affairs Commission: the choice between forming an entity and engaging an employer of record therefore comes first of all.

PenCom, NSITF and ITF then make three independent processes with three separate annual certificates. The employee, for their part, selects a pension fund administrator, information to be collected before the first payroll run.

The company's expatriate quota, the employment authorisation and the residence permit have to be aligned where the employee is a foreign national, each following its own procedure.

Given to the employee, the written contract sets out the essential terms of employment; duration, notice, leave and termination are checked in it provision by provision.

Under PAYE, the employer withholds tax and remits it to the relevant state, while social contributions follow their own channels. Closing pension records and issuing end-of-employment certificates, finally, are best prepared before the exit itself.

The state-level character of wage tax is the country's most discriminating feature. An employer or provider producing only a federal tax certificate has demonstrated nothing about its position on wages: the certificate issued by the relevant state tax authority is what counts, and it alone.

PenCom for pensions, NSITF for work injury, ITF for training: the number of annual social certificates is without parallel in the region, and each has its own deadline. A complete file means gathering them together.

A recent tax reform also changes the name of the federal revenue administration. Older and newer documents therefore carry different letterheads without that revealing any irregularity: knowing this avoids wrongly rejecting a perfectly valid document, and it is worth asking a counterparty which name its most recent filings were made under.