Registering with FMBN for the National Housing Fund
How a Nigerian employer registers with FMBN on Form NHF1, enrols staff on Form NHF2, and remits NHF deductions with a schedule each month.
By Achekam · · 5 min read · For Running a business businesses in Nigeria
A business can run Nigerian payroll for months with a tidy NHF line on every payslip and still be unknown to the Federal Mortgage Bank of Nigeria. Deducting the contribution is only half of the arrangement. The other half is registration: the employer needs its own number with FMBN, and each employee needs a participation number, or the money leaving your bank account has nowhere clear to land.
This article walks through the registration procedure FMBN publishes, the two forms it relies on, how remittances should travel, and where Achekam's payroll fits in. It is written for owners and payroll officers who have decided to operate the National Housing Fund and want the paperwork right from the first month.
The employer's form: NHF1
FMBN describes the steps on its page about the NHF scheme's legal framework, under the heading "Procedure For Registration". The page also covers the Act behind the Fund, the benefits of contributing and the conditions for a refund, so it is worth reading end to end once.
Under that procedure, the employer completes Employer Registration Form NHF1 and returns it to the nearest FMBN branch. In return, FMBN issues an employer's registration number.
Treat that number the way you treat your Tax ID. It identifies the business on every remittance, and a payment sent without it is far harder for FMBN to place. Once it arrives, put a copy of the confirmation in your payroll file and tell whoever pays FMBN each month exactly where to find it.
Each employee's form: NHF2
The second form belongs to the staff. FMBN's procedure says employees complete Form NHF2 through the employer, and receive NHF participation numbers.
The phrase "through the employer" matters. You are the channel: you hand out the form, collect it completed, submit it, and pass each participation number back to the person it belongs to. Two habits keep this from slipping:
- Put Form NHF2 in the pack every new starter signs in their first week, beside their bank details and tax information.
- Keep a simple list of staff with the date each form went in and the participation number received, so a gap is visible before it becomes a problem.
A participation number is what lets an employee later show what they have contributed, whether for a housing loan or a refund at retirement. Staff who never received one tend to discover it at the worst possible moment.
What the contribution is, as FMBN states it
FMBN states that contribution to the National Housing Fund is mandatory at 2.5% of the monthly income of Nigerians earning N3,000 and above per annum. That threshold is quoted exactly as the page gives it, and it looks dated. FMBN's page also says the Act behind the Fund, Act 3 of 1992, is being amended. Treat the figures as correct at the time of writing only, and check the current position with FMBN or your adviser before you set up payroll.
Deducting and remitting with a schedule
FMBN says an employer must deduct NHF contributions at source and remit them with a schedule of payment showing the amounts and the period covered.
Both parts of that sentence carry weight. Deducting at source means the contribution comes out of pay before the employee receives it, so the money you hold afterwards is not yours. The schedule is what allows FMBN to credit each contribution to the right participation number for the right month. A lump sum with no schedule is just a deposit nobody can allocate.
FMBN's procedure has a separate route for self-employed contributors, who remit their contributions monthly to FMBN themselves. If you are unsure which route applies to a particular person, such as an owner who draws no salary through payroll, ask FMBN before you start.
Where Achekam's payroll comes in
Registration happens with FMBN, on FMBN's forms; Achekam plays no part in it. What Achekam handles is the monthly arithmetic and the paper trail.
Achekam's Nigerian payroll calculates PAYE on the Nigeria Tax Act 2025 bands, together with pension, the National Housing Fund, NSITF, the ITF levy, rent relief and the minimum-wage exemption, from a table a person confirms. NHF is opt-in: it is calculated only for an employer that has switched it on.
From each approved pay run, Achekam prepares the Nigerian monthly schedules, including the one for NHF. That schedule is your working document for the FMBN remittance.
Achekam does not file or pay Nigerian payroll returns. A person pays FMBN and records the filing with the reference FMBN gave. A second person confirms each payment, and a schedule is finalised by someone other than the person who prepared it.
A month in practice
- The payroll officer prepares the monthly run, and someone else approves it.
- The NHF schedule is produced from the approved run.
- The payroll officer remits the total to FMBN with a schedule showing each amount and the month covered, quoting the employer's registration number.
- The officer records the payment in Achekam with the reference FMBN issued.
- A second person checks the reference and amount against the schedule and confirms it.
Offences and penalties
FMBN says sections 20, 21 and 22 of the Act define the offences and penalties for non-compliance. This article quotes no penalty figure. With the Act under amendment, read those sections themselves or ask your adviser rather than relying on an amount passed around in conversation.
The practical risks are easy to picture. A business that deducts and does not remit is holding its employees' money. A business that remits without schedules leaves its staff with contributions that cannot be traced to them. Both are avoidable with the routine above.
Registration checklist
- Form NHF1 completed and returned to the nearest FMBN branch.
- Employer's registration number received and filed where the payroll team can find it.
- Form NHF2 completed by each employee through the business, with participation numbers passed back to staff.
- NHF switched on in payroll only once the decision to operate it has been made and recorded.
- Each month: approved run, NHF schedule, remittance with the schedule, payment recorded with FMBN's reference, second person confirms.
- Form NHF2 built into every new starter's onboarding.
For what the contribution means on a payslip and how the pay basis is chosen, read National Housing Fund deductions for Nigerian staff. If a payroll bureau runs your payroll, how a bureau handles the NHF opt-in explains the decision from its side. Start with Form NHF1 this month; everything else depends on that number.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
