As of January 2021, the Federal Inland Revenue Service (FIRS) requires non-resident entities like Twilio Inc. dba SendGrid & its affiliates (“Twilio SendGrid”) to collect Value Added Tax (VAT) for any Electronically Supplied Services (“ESS”) sold to customers located in Nigeria.
Twilio will begin collecting this VAT starting in July 2026. This guide covers how Twilio charges VAT and what services are taxable.
Notice: Twilio services may be subject to tax in various countries, states and/or localities. To see if Twilio collects taxes in your country, please see the Taxes section of our Support Help Center.
Value Added Tax (VAT) Overview for Nigeria
The Federal Inland Revenue Service (FIRS) requires non-resident entities selling digital services to collect and remit a 7.5% Value Added Tax (VAT) on its sales to customers located in Nigeria. Concurrently, the contracting entity for Nigeria will change from Twilio Inc. to Twilio Ireland Limited.
Unlike many other tax jurisdictions, non-resident suppliers are required by the FIRS to apply VAT to all invoices by default. This means the tax covers both Business to Business (B2B) and Business to Customer (B2C) transactions alike.
Frequently Asked Questions
When will Twilio SendGrid start charging VAT in Nigeria?
Twilio SendGrid will begin collecting VAT on services sold to customers located in Nigeria starting in July 2026.
How can I be tax exempt for VAT?
Standard tax exemptions are not available for Nigerian customers. As a non-resident supplier, Twilio SendGrid has the primary responsibility to collect and remit the 7.5% VAT for all customers. The FIRS implementation plan dictates that Twilio must charge the 7.5% VAT on all sales; therefore, the tax applies to both B2B and B2C transactions equally.
I am a business with a valid Tax Identification Number (TIN). Do I still have to pay VAT?
Yes. Unlike other regions where B2B customers can utilize a reverse charge mechanism to avoid front-end taxation, the Nigerian tax framework for non-resident digital service providers requires VAT to be applied to all transactions by default. You must still pay the 7.5% VAT on your Twilio SendGrid invoice.
How do I enter my Tax Identification Number (TIN) or VAT number?
Nigerian customers can enter their tax ID number in the “VAT Number” field in the Account Details Page. The tax ID label in the SendGrid Customer Console will automatically update to reflect "TIN" when your account country is set to Nigeria.
Note: Please ensure your business details and TIN are entered so that your tax invoice is fully compliant for your local accounting purposes.
How is VAT determined?
VAT is applicable based on the type of products or services that are purchased. We have determined that most of Twilio SendGrid’s products & services are subject to VAT as Electronically Supplied Services (Digital services).
Please ensure your service address is up to date in the Account Details Page to ensure correct taxation for your location.
What rate is VAT charged in Nigeria?
Twilio SendGrid's services will be subject to the standard 7.5% VAT rate as determined by the Federal Inland Revenue Service (FIRS).
I forgot to enter my VAT number, but am a VAT registered B2B customer - can I request a refund?
Having a valid TIN (VAT) number does not exempt a B2B customer from being charged VAT. In Nigeria, the tax applies equally to both B2B and B2C transactions. Furthermore, please note that no tax credits can be issued for B2B customers under these regulations. If you have any further questions, please contact our Support team.
Where can I see the VAT charged on my Invoice?
You can see the VAT amount charged on your invoice in the Tax Summary section or in the Usage Summary section under “Taxes”. The invoice will clearly display the 7.5% VAT breakdown. Your invoice will continue to show subscription charges, usage, and taxes in the same currency as before.