Posting NIP charges and levies at month-end

On a busy account they are most of the unmatched lines, and the least interesting. Here is how to deal with them in one pass.

Updated 21 October 2026

Why they pile up

Every outgoing NIP transfer carries a bank charge, and the bank adds VAT at 7.5% on that charge. On most statements that shows as amounts such as ₦10.75, ₦26.88 and ₦53.75, one line per transfer. Some accounts also carry levies on qualifying receipts, stamp duties on older periods, SMS alerts, card maintenance fees and account maintenance charges. None of them is in the cash book until someone posts them, so at month-end they sit as hundreds of small unreconciled items on the bank side.

What good looks like

Every charge on the statement is either posted to the ledger for the same period or listed as a reconciling item with a reason.
Charges are posted in total by type (for example “NIP transfer charges, October”, “VAT on bank charges, October”), not line by line, with the statement lines kept as support.
The VAT on bank charges is recorded separately from the charge where your VAT treatment requires it.
Nothing older than a month is still open without an explanation.

A simple routine

Filter the statement narration for the charge descriptions your bank uses (for example “NIP TRANSFER CHARGE”, “VAT”, “SMS ALERT”, “MAINTENANCE FEE”). Each bank words them differently; keep a list per bank.
Total each type for the period and check the count is plausible against the number of transfers made.
Post one journal per type, referencing the period and the statement.
Mark the statement lines as explained by that journal, so the reviewer can see which lines it covers.
Anything that does not fit a known type stays open and gets a question to the bank.

Where it goes wrong

Posting each charge individually: hundreds of journal lines nobody reviews.
Netting charges against a transfer instead of showing them separately.
Leaving charges for the year-end: twelve months of small items become one large, unexplained difference.
Charges reversed by the bank later in the month and posted twice.

General guidance, not tax or legal advice. Rates and rules change; check current CBN and tax guidance or ask your adviser.