January 29, 2022


Accounting + Finance Blog

Due Date for PAYE Tax and Certain Penalties you should know

Due Date for PAYE Tax and Certain Penalties you should know

Failure to pay taxes is an art of disobedience to the law of a country. It also attract penalties. This may include going to prison as little as six months. This is why registered individuals’ businesses and corporations should ensure regular returns of all tax categories as and when due. This article focus on due date and penalties for PAYE.

Due Date for PAYE Returns

The date the employer is expected to remit monthly PAYE returns is on or before 10th of the preceding or following month. This means that the monthly PAYE for April, 2021 must be remitted on 10th of May, 2021. On a yearly basis, the employer must remit employees returns the 31th of January of the preceding year.

Read: Format and Example of PAYE in Nigeria tax system

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Aside remitting monthly charges for staff, the entity will also compile it’s yearly returns to the relevant tax authority at the end of the year. And must be done on or before 31th of January of the following year. For example, PAYE return for the year 2020 must be filed on 31th January 2021.

Penalties for Late Filing of Returns

Failure to file PAYE returns attracts penalties. For the monthly remittance, the penalties are 10% of the amount not paid plus an interest rate which is based on the Central Bank of Nigeria Monetary Policy Rate. The current MPR rate is 11.5 percent as at the time of writing this article. Or a six months imprisonment on conviction. For the yearly filling, the penalty is 500,000 Naira for corporate entities and 50,000 Naira for small businesses.

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Other Penalties you should know

Here are other penalties you should know

Not filing tax after commencement of business. Employees are given six months grace to fill their PAYE returns upon commencement of business. Failing to do so at the end of the period attracts a fine of 25,000 Naira plus the arrears not paid.

Read: Tax administration: Meaning and Key Explanations

National housing fund penalty. Failing to remit this fund attracts 50,000 Naira for corporate entities and 5,000 Naira for individuals.


One of the non controllable aspects of a business environment is the tax authority. The business should therefore endeavour to remit it’s liabilities to avoid sanction from them. For PAYE, it is necessary the entity registered it’s employees on time, pay the dues regularly to avoid penalties that will erode the business profits.