The Tax Act, 2025 provides for the streamlining of all tax payments with the Single Tax Account (STA).
What Is the Single Tax Account (STA)?
Under Section 101 of the Nigeria Tax Act, 2025, the Single Tax Account is defined as a digital account assigned to each taxpayer, linked to their Tax Identification Number (TIN). It serves as:
- A centralized repository of all tax obligations across all jurisdictions, federal, state, and local,
- A payment portal through which taxes can be remitted directly to the appropriate government account, and
- A compliance dashboard where taxpayers can view, download, and reconcile their payment history.
In essence, the STA gives every taxpayer a personalized fiscal identity or a single digital window into their entire tax life.
The system works by automatically issuing a unique STA to every taxpayer, whether individual or corporate, upon registration for a TIN. This single account facilitates all tax payments—such as Company Income Tax, VAT, PAYE, and Withholding Tax—via bank transfer, e-portal, or an integrated payment gateway. Subsequently, the system automatically routes the funds to the correct tax authority.
Taxpayers can view real-time balances, pending obligations and receipts within the portal, and the STA generates a consolidated tax statement useful for audits, loan applications or obtaining a Tax Clearance Certificate (TCC). This seamless, technology-driven process eliminates the traditional confusion over which agency to pay.
The Rationale Behind the Reform
The creation of the STA was driven by three key policy motivations:
- Transparency: To make every tax naira traceable, from the taxpayer’s account to the government’s treasury.
- Efficiency: To reduce errors, duplication, and manual reconciliations among multiple agencies.
- Compliance: To give taxpayers a simple, accountable way to track obligations and payments and minimize inadvertent default.
The government sought to make every tax naira traceable from the taxpayer’s account to the government’s treasury, to reduce errors and manual reconciliations, and to give taxpayers a simple, accountable way to track their obligations. Recognizing that complex systems often lead to inadvertent non-compliance, the STA was designed to turn complexity into clarity.
Integration Across Government Tiers
One of the boldest aspects of the STA system is its federal–state–local integration. The National Tax Data Warehouse synchronizes all STAs—whether issued by the National Revenue Service or by any State Internal Revenue Service. That means:
- You can file your federal VAT through your STA,
- Pay your state Personal Income Tax through the same interface,
- And even view your local government levies or tenement rates within the same profile.
An algorithm, jointly supervised by the NRS (which replaces the FIRS), the Joint Tax Board (JTB), and the Office of the Accountant General of the Federation, automatically allocates the funds to the appropriate jurisdiction.
The Role of the Tax Identification Number (TIN)
The STA system revolves around the Tax Identification Number, which now functions as a universal fiscal identity code. The TIN links the taxpayer to all taxes and government interactions, enables verification of payments across agencies, and prevents duplication or the use of multiple identities for evasion.
Digital Payments and Automation
The 2025 Act mandates that taxpayers make all payments into the STA electronically through licensed financial institutions, fintech partners, or the NRS e-tax portal. Upon payment, the system automatically generates a Digital Payment Receipt, records the transaction in the taxpayer’s history, and sends an instant notification to the appropriate authority.
This ensures that every payment leaves a digital footprint that will be auditable by both the taxpayer and the government.
Manual receipts and handwritten ledgers are now officially obsolete.
Access, Security and Privacy
The law also recognizes that with digitization comes the need for strong data protection. Therefore, under Section 103 of the Nigeria Tax Administration Act, tax authorities are required to:
- Maintain secure encryption protocols for all STA data,
- Obtain consent before sharing taxpayer information (except for audit or law enforcement purposes), and
- Ensure that every taxpayer can access, correct, or download their data when needed.
What the STA Means for Businesses and Tax Authorities
For businesses, especially SMEs and freelancers, the STA brings revolutionary simplicity. It offers one platform for all taxes, real-time visibility of obligations to aid cash flow planning, instant receipts for loan applications or procurement verification, and improved compliance scores since every transaction is transparently logged. In time, banks and lenders may even use a business’s STA history as a compliance credit score, since every tax-related transaction is transparently logged.
For the tax authorities, the STA represents a data revolution. It consolidates taxpayer behaviour into actionable intelligence that can tell which sectors pay regularly, which regions underperform, and which businesses show irregular filing patterns.
At a Glance: How STA Changes the Game
| Feature | Old System | STA System (2025 Act) |
|---|---|---|
| Payment channels | Multiple, manual | One digital account linked to TIN |
| Receipts | Paper-based | Instant electronic confirmation |
| Record-keeping | Dispersed across agencies | Centralized and auditable |
| Taxpayer identity | Fragmented | Unified through TIN |
| Compliance visibility | Low | Real-time, data-driven |
| Access to services | Bureaucratic | Portal-based, user-friendly |
