A tax compliance expert has warned that large businesses with annual turnover of N5 billion and above risk penalties from July 1, if they fail to comply with the electronic invoicing (e-invoicing) mandate.

The Country Director of DigiTax Nigeria, Mr. Olumide Akinsola, said this during a virtual news conference on Tuesday in Lagos.

He said that the compliance window for large taxpayers would close on June 30, after which enforcement would begin.

According to him, in spite of growing adoption of the system, thousands of companies within the category remain outside the compliance framework.

He disclosed that more than 1,000 of estimated 5,000 large taxpayers had complied with the e-invoicing requirement as at early in the year.

“The NRS says the results are encouraging, but there is still a significant number of businesses outside compliance,” Akinsola said.

DigiTax, a pan-African e-invoicing platform developed by Namiri Technology Ltd., serves as an integration layer between businesses’ invoicing systems and the regulatory infrastructure of national tax authorities.

The company is accredited by the Nigeria Revenue Service (NRS) as both an Access Point Provider (APP) and System Integrator (SI).

Akinsola warned that businesses that fail to transmit invoices through the NRS Merchant Buyer Solution platform would face financial consequences.

He explained that invoices not validated through the platform would be ineligible for Value Added Tax (VAT) input tax credit claims, forcing businesses to absorb the associated VAT costs.

“It is impossible to claim VAT input credits if invoices are not transmitted to the NRS system,” he said.

He said that every VAT amount linked to a non-transmitted invoice after the enforcement date would effectively become a penalty.

The expert added that interest would accrue at a rate of two per cent above the Central Bank of Nigeria’s Monetary Policy Rate.

Akinsola further disclosed that the second phase of the e-invoicing programme would begin in July 2026 for medium-sized businesses with annual turnover between N1 billion and N5 billion.

Enforcement for that category is scheduled to take place between January and March 2027, while businesses with turnover below N1 billion will be onboard same year, with enforcement beginning in 2028.

Under the framework, businesses are required to generate, validate and submit invoices electronically in real time. Each validated invoice is assigned an Invoice Reference Number (IRN) and a QR code for verification.

The current mandate covers VAT and withholding tax transactions.

Akinsola explained that e-invoicing remains a critical tool for reducing tax leakages, improving compliance and strengthening revenue administration.

He said the initiative would enhance transparency, improve revenue collection and help narrow Nigeria’s tax gap, while aligning the country with global best practices adopted in countries including Kenya, Zambia, South Africa, Ghana, India and several European nations.

He also called on government agencies to intensify stakeholder engagement, provide technical support and strengthen digital infrastructure to ensure seamless implementation.

Akinsola urged businesses to prepare ahead of enforcement deadlines, while advising companies to assess their invoicing systems, engage accredited service providers and train relevant personnel.

According to him, e-invoicing simplifies VAT administration, improves record-keeping, reduces audit burdens and supports faster tax refund processing.

“Businesses should not wait until enforcement deadlines approach before taking action because integration and compliance require planning and system adjustments,” he said.

He noted that companies already using e-invoicing have reported easier VAT filings, improved cash-flow management and greater operational efficiency.

Akinsola also advised businesses to view compliance not merely as a regulatory obligation but as an investment in transparency, efficiency and long-term sustainability.

He added that Africa loses an estimated N20 trillion annually to tax gaps and revenue leakages, underscoring the need for stronger tax administration systems across the continent. (NAN