Why You Need a Separate Business Account As a Realtor in Lagos (And What Happens If You Do Not Have One)

Most realtors in Lagos treat the business account question as a matter of good organisation—something to sort out later, once the deals get bigger.

It is not. Under Lagos law, a separate client account for realtors in Lagos is a condition of registration. Not a recommendation. A requirement with a section number attached, and without it your registration application does not qualify.

That is the part almost nobody knows. What follows is what the law actually says, and what happens to agents who keep running client money through the same account that receives their salary and their mother’s birthday transfer.

The Rule Nobody Reads

The Lagos State Real Estate Regulatory Authority Law 2021 sets out what you must have before the Authority will register you.

Section 26(2) lists the conditions for individual applicants. Among them, at paragraph (g), you must have proper records of transactions and operate a separate client account. Paragraph (h) requires three years of Tax Clearance Certificates preceding the date of registration. Paragraph (i) requires you to register at least a business name with the Corporate Affairs Commission.

Section 26(3) applies the same separate client account condition to corporate applicants, alongside CAC registration.

You can read the LASRERA Law in full yourself. It is worth twenty minutes.

Note what this means in sequence. A separate client account for realtors in Lagos is not something you set up after you register. It is something you must already have for the registration to be valid.

Why a Separate Client Account for Realtors in Lagos Is Mandatory

Because of section 32, which only works if that account actually exists.

Section 32(1)(d) requires you to remit money collected to the landlord within seven working days, and requires that the money collected be receipted. Seven working days, and a receipt.

Now picture proving that from a personal account. Client money landed on a Tuesday, alongside your commission from a different deal, a transfer from your brother, and your POS float. Three weeks later someone asks you to demonstrate that a specific sum reached the landlord within seven working days. You cannot reconstruct it, because it was never separable in the first place.

One correction worth knowing, because LASRERA’s own website contradicts the statute here. The website has said fourteen days. The Law says seven working days. The Law governs.

Section 32(2) also caps what you may charge: not more than 10% of total rent collected on a letting or lease. On sales, not more than 15% of the total proceeds, and read that one carefully, because the 15% applies where two or more holders of permits are retained by the owner or vendor.

What Happens If You Do Not Have One

Six consequences of trading without a separate client account, in rough order of how likely they are to actually reach you.

Your registration does not qualify. The client account is a condition under section 26(2)(g). Without it, you are not properly registered, and practising unregistered is an offence. Section 48 sets the fine at not less than ₦250,000 for an individual and not less than ₦1,000,000 for an organisation. Operating unregistered carries ₦100,000 plus ₦25,000 for each day of default for an individual, and ₦500,000 plus ₦50,000 per day for an organisation. Per day is the part that compounds while you are not thinking about it.

You overpay tax on money that was never yours. This is the one that costs you cash every month. Under the Deduction at Source Regulations 2024, withholding tax on commission runs at 5%. But commission retained by a broker from monies collected on behalf of a principal, in line with industry norm, is exempt. PwC notes this puts an age-long issue to rest. That exemption only works if the principal’s money is identifiably the principal’s money. Run everything through one personal account and the whole receipt looks like your income. Worse, where a vendor provides no Taxpayer Identification Number, withholding tax applies at twice the designated rate.

You are a DNFBP whether you know it or not. The Money Laundering (Prevention and Prohibition) Act 2022 section 30 defines a Designated Non-Financial Business and Profession to include dealers in real estate, estate developers, estate agents and brokers. That is you. Section 6(1)(a) requires a new business to register with SCUML before commencement of business.

One ordinary Lagos deal triggers a report you never filed. Section 2(1) sets cash limits of ₦5,000,000 for an individual and ₦10,000,000 for a body corporate. Section 11(1) requires a DNFBP to report to SCUML in writing within seven days any single transaction, lodgment or transfer of funds above those thresholds. Section 11(3) prices failure at a fine of at least ₦250,000 and not more than ₦1,000,000 for each day. A year’s rent on a decent Lekki flat clears ₦5 million. The exposure accrues quietly, because agents who are not registered are not filing.

Your bank can close the account. The SCUML Regulations 2024 require real estate agents, brokers and developers to verify the identity of their clients, including purchasers and vendors, and to record the source of funds. Separately, under the Central Bank’s Customer Due Diligence Regulations 2023, a bank that cannot complete due diligence is not permitted to open the account and must file a Suspicious Transaction Report, and where the relationship already exists, must terminate it and report. A personal account taking repeated multi-million-naira third-party deposits is exactly the pattern those rules are written for.

You can be prosecuted for someone else’s money. Section 18(2) of the Act reaches a person who reasonably ought to have known that funds were proceeds of crime. Knowledge may be inferred from objective factual circumstances. Penalties run to imprisonment and multiples of the proceeds, with professional bans on top.

The EFCC Is Already Looking Here

This is not a theoretical compliance lecture. It is where enforcement is actually pointed.

EFCC Chairman Ola Olukoyede has said money laundering is rampant among real estate developers, and that operators who skip know-your-customer checks would be held accountable when fraudulently acquired assets are traced to their projects. More than fifteen real estate projects are facing civil forfeiture. The Commission runs a dedicated Land and Property Fraud Unit.

Lagos is moving on the licensing side at the same time. Punch reported in July 2025 that it is an offence to practice real estate business, either as a commission agent, realtor, or real estate practitioner, without proper registration.

The scale tells you how exposed the average agent is. At the 2024 Ministerial Press Briefing, Barakat Odunuga-Bakare, Special Adviser to the Governor on Housing, said LASRERA had a database of 925 registered individuals and organisations, while over 2,550 practitioners had enrolled to be registered. Enrolled is not registered.

What to Actually Do This Month

Opening a separate client account for realtors in Lagos is only part of it, and the sequence matters, because each step is a precondition for the next.

Register a business name or company with the Corporate Affairs Commission. Section 863(1) of CAMA 2020 prohibits carrying on business under a business name without registration, and in April 2025 the CAC warned that non-compliance may result in prosecution. There is a narrow exemption for trading under your own true surname and forenames, but LASRERA section 26(2)(i) requires a business name regardless, so the exemption does not help you.

Get a TIN, and start your Tax Clearance Certificates. Section 26(2)(h) wants three years preceding registration, so the clock is already running against you.

Open two accounts, not one, and treat the separate client account as untouchable. An operating account for your own commission and expenses, and a separate client account that holds nothing but money belonging to other people. Never pay a personal expense from the second one.

Register with SCUML before you take another deal, and set up your reporting. Weekly transaction filing above the thresholds, and suspicious transaction reports within 24 hours under section 7(2).

Then check your own status on the LASRERA practitioner search. It is public and free, and it returns either Active or De-Registered. Your clients can search it too, which is rather the point.

If you are building the commercial side alongside the compliance side, our guide to making consistent sales as a Lagos realtor covers the pipeline work, and our breakdown of LASRERA, ESVARBON and NIESV explains which body actually regulates you.

The Argument That Should Persuade You

Forget the penalties for a moment, because fear is a poor reason to run a business properly.

A separate client account for realtors in Lagos is the cheapest credibility you will ever buy. When a diaspora buyer asks where their ₦120 million will sit between wire and closing, an agent who can name a dedicated client account, produce a receipt, and point to a seven-working-day statutory remittance duty has answered the question. An agent who says “send it to my account, I will sort it out” has answered a different question, and the buyer heard that one too.

The Lagos market is repricing trust right now. Buyers who lost money have made everyone else cautious, and the agents who win the serious mandates over the next few years will be the ones who look like a business rather than a phone number.

The account costs you nothing. Not having it can cost you the licence, the tax exemption, and the client.

How Edenbrooks Homes Works With Registered Realtors

We work with agents on our Lekki Phase 1 developments, and the compliance questions come up early because our buyers ask them early. A realtor who can show LASRERA registration, a business name, and a separate client account is a realtor we can put in front of a diaspora client without hesitating.

If you are selling Maison D’Eko Residences, Wakefield Apartments or Paragon Apartments, you are selling titled property with perfected Governor’s Consent, and the paperwork on your side should match the paperwork on ours.

Contact us today to start the conversation. Our team will walk you through what we expect from partner realtors, and how a properly structured practice opens doors to the diaspora buyers who ask these questions first.

Email: [email protected] | Call/WhatsApp: +2347060474224 | +2348087691124