Nigeria Expands Mandatory E-Invoicing to SMEs

The Nigeria Revenue Service (NRS) is moving forward with the implementation of its e-invoicing and Electronic Fiscal System (EFS), also known as the Merchant Buyer Solution (MBS), extending mandatory e-invoicing requirements to medium and small taxable persons. The NRS announcement, issued in February 2026, provides clarity on the transition timeline and signals the gradual move toward full fiscal digitalization.

Next Stages in the E-invoicing Rollout

Initially, the EFS system went live in August 2025, first including large taxable persons with an annual turnover of NGN 5 billion (around USD 3.6 million) or more. Nonetheless, the effective implementation deadline was later extended to November 2025 to accommodate transitional and operational adjustments required by affected businesses. 

Currently, these businesses are undergoing a post-implementation review period from January to March 2026, while compliance enforcement is scheduled for April 2026. From that date going forward, penalties may apply for failure to comply with e-invoicing obligations.

The next implementation phase targets medium taxable persons with annual turnover between NGN 1 billion (around USD 720,000) and NGN 5 billion. It is set to go live on July 1, 2026, with formal enforcement commencing in January 2027. Small taxable persons, or as defined by NRS, emerging taxable persons, with turnover below NGN 1 billion, will follow one year later, with go-live planned for July 1, 2027, and enforcement beginning in January 2028.

Notably, the NRS stated that enforcement measures will take effect only once each taxable person's category has completed the full implementation cycle, including stakeholder engagement, pilot testing, and post-go-live reviews.

Conclusion

Since the NRS set a clear implementation timeline, taxable persons should determine their classification and prepare for onboarding in line with the schedule for the rollout. Once enforcement begins, non-compliance will trigger penalties under the Nigeria Tax Administration Act, reinforcing the mandatory e-invoicing regime and confirming Nigeria’s transition toward technology-driven tax compliance and real-time transaction monitoring.

Source: Nigeria Revenue Service, VATabout