7.5% VAT on the duty-inclusive import value.
Import VAT
—
VAT base (CIF + duty)
—
Total landed cost
—
Why import VAT is a tax charged on a tax
When goods land in Nigeria, value added tax is not applied to the bare shipment value. It is applied to the duty-inclusive value, meaning the customs duty has already been added to the base before VAT is worked out. That is the quirk this calculator captures and that catches out a lot of first-time importers. You are effectively paying VAT on the duty as well as on the goods, so the final VAT figure is higher than a quick 7.5 percent of your invoice would suggest.
The two numbers the tool needs
The calculator asks for two figures. The CIF value covers cost, insurance, and freight: the landed value of the goods before any tax, expressed in naira after conversion from the supplier's currency at the applicable exchange rate. The customs duty is whatever the Nigeria Customs Service assesses on that consignment, which varies by tariff line and can run from a few percent on raw inputs to much steeper rates on finished or restricted goods. Add the two together and you have the VAT base. Apply the rate this calculator uses, 7.5 percent, and you have the import VAT collected at the port alongside duty.
Get the CIF right and the rest follows. A frequent slip is entering the bare invoice price and forgetting the freight and insurance that customs includes in the value. If your shipment cost NGN 9 million for the goods plus NGN 1 million to ship and insure, the CIF is NGN 10 million, not NGN 9 million, and the duty and VAT both build on the larger figure.
A NGN 10 million shipment at the port
Take the defaults and the rate this calculator applies. A consignment with a CIF value of NGN 10,000,000 attracts customs duty of NGN 1,000,000. Those combine into a VAT base of NGN 11,000,000. VAT at 7.5 percent on that base is NGN 825,000. The total landed cost, before clearing agents and port charges, is NGN 11,825,000. Notice that the VAT is NGN 75,000 higher than 7.5 percent of the goods alone, purely because the duty sits inside the base.
| Component | Amount |
|---|
The chart stacks the three pieces that make up the landed cost, with VAT layered on top of the duty-inclusive base.
When the VAT comes back to you
For a business registered for VAT, import VAT is usually not a dead cost. It is input VAT, and it can be set against the output VAT you charge customers, with the balance recoverable. Under the current regime the figures on this site reflect, input VAT on goods and on many services and fixed assets is claimable, and there is a window, up to five years, in which to claim it. So a trader importing stock should think of the NGN 825,000 in the example as cash flow that comes back through the VAT return, not money gone for good. An individual importing for personal use does not get that recovery, so for them the VAT is a true addition to cost.
A common error is to enter the duty rate where the tool wants the duty amount. This calculator expects the actual naira duty the Customs Service has assessed, not the percentage. If you only know the tariff rate, work out the duty on the CIF value first, then enter that figure. Getting it wrong understates or overstates the base, and because VAT keys off the base, the error flows straight through to your landed cost.
Are any imports free of VAT at the port?
Yes. Certain categories, including many basic food items, some medical and educational supplies, and other zero-rated or exempt goods, are not charged standard-rate import VAT. The classification depends on the tariff line and the prevailing exemption list, which changes from time to time. If you believe your goods qualify, confirm the status before you assume zero VAT, because misclassifying a dutiable item can trigger penalties at clearance.
Where should I confirm the rate and my duty?
Import VAT is administered by the Federal Inland Revenue Service and collected at the border by the Nigeria Customs Service. The 7.5 percent rate this tool applies has not been independently verified here and could change as tax reform continues, so confirm the current rate with the FIRS and confirm the duty on your specific tariff line with the Customs Service before you commit to a purchase. The two figures together decide your landed cost.