January is when many Nigerian companies discover their monthly PAYE records don't quite add up. The annual employer return is the reason. Prepare during the year and it's a one-hour job.
What is Form H1?
Form H1 (the employer's annual declaration) is the annual return an employer files with the State Internal Revenue Service. It shows, for each employee, the total pay, reliefs and PAYE deducted in the previous calendar year. It reconciles the monthly PAYE you remitted with what should have been deducted.
When is it due?
By 31 January each year, for the previous year. For 2026 payroll, file by 31 January 2027.
Which state do I file with?
The state where each employee lives, which is the same state their PAYE went to. A Lagos company with staff living in Lagos and Ogun files with both Lagos IRS and Ogun IRS.
What information do I need?
For each employee who worked for you during the year:
| Field | Notes |
|---|---|
| Full name and Tax ID (NIN) | Match their records |
| Employment dates | Start and end dates if they joined or left |
| Gross annual pay | By component where the state form asks |
| Pension (8%), NHF and other reliefs | Including rent relief claimed |
| Taxable income | Gross minus reliefs |
| PAYE deducted | Total for the year |
| PAYE remitted | Should equal PAYE deducted |
States also usually ask for proof of monthly remittances (receipts) and the company's details.
How do I file?
- Download your payroll summary for the year, by employee and by month.
- Reconcile PAYE deducted with PAYE remitted for each month and state. Fix any gaps before filing.
- Fill the state's return format. Most states, including Lagos (via its eTax portal), accept online filing and schedule uploads.
- Attach remittance receipts as required.
- Keep the acknowledgement. You'll need it for audits and tax clearance.
Common problems
- PAYE remitted to the wrong state during the year.
- Staff who left mid-year missing from the return.
- Rent relief claimed without evidence on file.
- Monthly figures that don't add up because of manual payroll changes.
How to make January easy
Run payroll in one system all year, remit PAYE by the 10th every month, and keep receipts together. In BizBooks, the Payroll Summary report gives gross pay, PAYE, pension and take-home by month and by person for the whole year, which is exactly what Form H1 needs. See payroll.
Frequently asked questions
What is Form H1 in Nigeria?
It's the employer's annual PAYE return, filed with the State Internal Revenue Service, showing each employee's pay, reliefs and tax deducted for the previous year.
When is the annual PAYE return due?
By 31 January for the previous calendar year.
Do I file Form H1 if I have only one employee?
Yes. Every employer with staff on PAYE files an annual return with the relevant state.
What if my employees live in different states?
File a return with each State Internal Revenue Service for the employees who live in that state.