UBA Provides Update on Tax Deductions for Investment Interest

UBA has provided its customers with update on Tax Deductions for Investment Interest as directed by the Federal inland Revenue Service, FIRS. In an email sent out today, November 11, 2025 to its numerous account holders, the bank said, “We wish to inform you of a recent publication released by the Federal Inland Revenue Service (FIRS) in relation to investment in short-term securities issued by the Federal Government of Nigeria. The publication sought to educate investors, discount houses, stockbrokers, Corporate Bond Issuers and holders, and the general public of the need to collaborate with the Government to ensure compliance with the tax implications of the investment in securities. Please see attached notice”.

The communique covered the following bases:

• The reference to the legislation/law that imposes withholding tax (WHT) deduction on the holders of the short-term securities
• Application of WHT deduction from interest income earned by both corporate and Individual investor categories
• The duty to deduct and remit the taxes to the relevant tax authorities
• The tax credit that accrues to the investor whose interest income has been subjected to tax deduction
• The exemption of WHT on FG Bonds and OMO bills issued by the Central Bank of Nigeria (CBN) and
• The express definition of “ Short-Term Securities” to cover Government Bonds, Treasury Bills, Promissory Notes, Corporate Bonds, Financial papers & Bills of Exchange etc.

Implications : 

On the strength of the above, United Bank of Africa (UBA) PLC will be ensuring 100% adherence with this directive. The applicable WHT rate is 10% of the interest (discount) at maturity and the amount so withheld will be remitted to the relevant tax authority as and when due. 

We are working with our support teams to ensure that this and other relevant details are embedded in the offer letters to be issued to investors in the nearest future and we will continue to keep you informed of any further regulatory updates that may affect your investments.