Nigeria changed its personal income tax rules from 1 January 2026 under the Nigeria Tax Act 2025. The first part of your income is now tax-free, the Consolidated Relief Allowance is gone, and a rent relief takes its place.
Type in your pay, your deductions and your rent, and you get the tax per month and per year, plus what is left in your pocket. It is meant for planning, so check anything important with the tax authority or an adviser.
How to use the Nigeria Personal Income Tax Calculator#
- Enter your income. Use your gross figure, which is your pay before tax, and choose monthly or yearly.
- Add your deductions. Enter the yearly amounts for pension, NHF, NHIS, home loan interest and life insurance. Leave the ones you do not have at 0.
- Add your rent. Rent relief is 20 percent of your annual rent, capped at ₦500,000.
- Read your tax. The result shows your tax per month and per year, your take-home pay and a chart of where your pay goes.
What counts as taxable income#
Your basic salary is the main part. Most allowances are taxable too, such as housing, transport and utilities, and so are bonuses and overtime. Some benefits in kind, such as a company car or free accommodation, can also be taxed when they have a clear money value. Some payments are not taxed as income, such as gifts, loans, remittances you receive and bank deposits.
Enter your gross figure here. The deductions below are then taken off before the bands are applied.
Deductions that lower your tax#
| Deduction | What it covers |
|---|---|
| Pension | Your own contribution under the Pension Reform Act. |
| NHF | Your National Housing Fund contribution. |
| NHIS | Your National Health Insurance Scheme contribution. |
| Home loan interest | Interest on a loan used to build or buy the house you live in. |
| Life insurance | Life insurance and deferred annuity premiums, for you or your spouse. |
| Rent relief | 20 percent of your annual rent, up to ₦500,000. |
These are taken off your gross income to give your chargeable income. Keep your pension and NHF statements, your loan interest schedule, your insurance receipts and your tenancy papers, since you may need to show them.
The 2026 tax bands#
Tax is charged in slices. Only the income inside each band is taxed at that band’s rate.
| Chargeable income slice | Rate |
|---|---|
| First ₦800,000 | 0% |
| Next ₦2,200,000 (to ₦3m) | 15% |
| Next ₦9,000,000 (to ₦12m) | 18% |
| Next ₦13,000,000 (to ₦25m) | 21% |
| Next ₦25,000,000 (to ₦50m) | 23% |
| Above ₦50,000,000 | 25% |
A worked example#
Take a salary of ₦500,000 a month, which is ₦6,000,000 a year. The person pays ₦360,000 into pension, ₦90,000 into NHF and ₦60,000 into NHIS, and pays ₦1,200,000 in rent. Rent relief is 20 percent of the rent, which is ₦240,000. Chargeable income is 6,000,000 − 510,000 − 240,000 = ₦5,250,000.
The first ₦800,000 is free. The next ₦2,200,000 at 15 percent is ₦330,000. The remaining ₦2,250,000 at 18 percent is ₦405,000. Total tax is ₦735,000 a year, or ₦61,250 a month, an effective rate of 12.25 percent. Take-home pay is 6,000,000 − 510,000 − 735,000 = ₦4,755,000 a year, about ₦396,250 a month.
How the bands work#
The bands are marginal, so each rate applies only to the slice of income inside it. Someone with a chargeable income of ₦24,000,000 does not pay 21 percent on everything. They pay nothing on the first ₦800,000, 15 percent on the next ₦2,200,000, 18 percent on the next ₦9,000,000 and 21 percent on the rest, for a total of ₦4,470,000, an effective rate of 18.6 percent. The highest rate, 25 percent, applies only to income above ₦50,000,000.
How often is PAYE deducted#
Employers work out PAYE every pay period and deduct it from your pay, so in practice it is a monthly deduction. The employer then pays it over to the tax authority, usually by the 10th of the following month, and files a yearly return, normally by 31 January. PAYE goes to the state revenue service of the state where you work, and some states ask for their own forms, so check with yours.
For most employees the employer handles all of this, so you do not have to work it out yourself.
What if I earn below the threshold#
If your income for the year is ₦800,000 or less, you owe no personal income tax and no PAYE should be taken from your pay. Income above that is taxed only on the part over the threshold, after your deductions.
What the calculator leaves out#
It does not model every relief, allowance or benefit in kind, and it treats the figures you enter as correct. Employers handle pension and other contributions in different ways, and some income, such as certain compensation, is exempt. If you are self-employed, or your situation is complicated, check with the Nigeria Revenue Service or a qualified tax adviser before you file. Tax law can change, so confirm the details with the tax authority.
Frequently asked questions#
Take your yearly gross pay, subtract your allowed deductions and rent relief, and apply the bands to what is left. The first ₦800,000 is taxed at 0 percent, and the rates then rise from 15 percent to 25 percent. The calculator does this for you.
From 1 January 2026 the first ₦800,000 of taxable income each year is taxed at 0 percent. Someone whose income is ₦800,000 a year or less pays no personal income tax.
It replaces the old Consolidated Relief Allowance. You can deduct 20 percent of the rent you pay in a year, up to ₦500,000. Keep your tenancy agreement and rent receipts, because you may be asked for them.
Pension contributions, National Housing Fund contributions, National Health Insurance Scheme contributions, interest on a loan for a home you live in, life insurance and deferred annuity premiums, and rent relief.
Not quite. Pension, NHF and NHIS come out of your pay as well, so take-home pay is your gross pay less those contributions and less the tax. Home loan interest, life insurance and rent are paid by you separately, so they lower your tax but are not taken from your payslip.
The bands are the same everywhere. Your PAYE goes to the state revenue service of the state where you work, and states can differ in how they administer it, such as the forms they ask for.
No. It is an estimate for planning. Your employer’s payroll, your state revenue service or a registered tax adviser has the final say.
No. Everything is worked out in your browser. If you accept all cookies, the calculator remembers your figures on this device only.