By Zeddi Osuka, Senior Associate - Tax

The Finance Act, 2026 has re-introduced the Tax Amnesty program, providing taxpayers with a rare opportunity to settle historical tax obligations while benefiting from a 100% waiver of penalties, interest, and fines. The amnesty took effect on 1st July 2026 and will run until 31st December 2026, making the next five months a critical window for taxpayers seeking to regularize their tax affairs.

Who Qualifies?
  1. The amnesty applies to tax liabilities and debts that accrued on or before 31 December 2025.
  2. A taxpayer may qualify in the following scenarios:
  • Where the principal tax is already paid: Taxpayers who had fully settled their principal tax liabilities by 31 December 2025 automatically qualify for a waiver of outstanding penalties and interest without making any application.
  • Late filing penalties only: Taxpayers with no principal tax due but with outstanding late filing penalties can benefit from an automatic waiver upon filing all outstanding tax returns.

  • Outstanding principal tax: Taxpayers with unpaid principal taxes for periods up to 31 December 2025 can access the amnesty by paying the principal tax during the amnesty period. Once the principal tax is settled, the related penalties and interest are waived.

Notably, tax liabilities (including penalties and interest) arising from 1st January 2026 onwards do not qualify for the amnesty and remain payable.

Why should taxpayers take advantage of the amnesty?
  • There are significant financial savings
    For many taxpayers, accumulated penalties and interest can be as much as the original tax debt. The amnesty offers an opportunity to eliminate these additional costs entirely, allowing taxpayers to focus solely on the principal tax due.

  • Improved tax compliance
    By regularizing outstanding tax matters, taxpayers can achieve compliance and boost their credibility with regulators, financiers, and business partners.

  • Opportunity for flexible settlement options
    Taxpayers who are unable to settle their principal tax immediately may enter into a payment plan through iTax, provided the tax is fully paid by 31 December 2026 to qualify for the amnesty.

  • Reduced risk of future enforcement
    Exposure to enforcement measures, including debt recovery actions and additional charges is one of the underrated taxpayer’s nightmare. The amnesty offers a cost-effective route to resolve historical tax issues before they escalate in future.

Conclusion

While the program runs until 31 December 2026, taxpayers are encouraged to act early. This allows sufficient time to review tax records, file outstanding returns, reconcile liabilities, and put in place payment arrangements where necessary.

Remember, once the window closes, the opportunity to obtain a 100% waiver of penalties, interest, and fines will be lost. This is the time to review your tax liability position and take the necessary steps to benefit from the relief available.