Nigeria Income Tax Calculator (2026)
Under the new Nigeria Tax Act. Enter your salary — no button, results update as you type.
Before deductions. Employment/salary income only — this tool does not model business, investment, or capital gains income.
Your gross income is at or below the national minimum wage (₦840,000/year) — the Nigeria Tax Act exempts minimum-wage earners from income tax entirely (Section 58), so your tax is ₦0 regardless of any deductions below.
Rent relief = 20% of this, capped at ₦500,000.
Your 8% pension deduction is based on Basic + Housing + Transport. Leave blank to estimate pension on your full salary instead.
Enter the actual annual amount you pay — the Tax Act deducts these as actual payments, not a fixed percentage.
Nigeria Income Tax Calculator (2026)
This calculator estimates your 2026 Nigeria personal income tax (PAYE) under the Nigeria Tax Act, 2025 — the law that took effect 1 January 2026 and completely replaced the old Personal Income Tax Act (PITA) system most Nigerians grew up with. Enter your gross salary and the numbers update immediately; there’s nothing to submit and nothing to sign up for. It models the new 0–25% progressive bands, the statutory pension deduction, rent relief, and the optional National Housing Fund (NHF) contribution — showing your chargeable income, tax by band, and exact take-home pay, both annually and monthly.
What Changed Under the Nigeria Tax Act 2025
The old system taxed the first naira of income (after the Consolidated Relief Allowance) across six bands from 7% to 24%. The Consolidated Relief Allowance — the higher of 1% of gross income, or a flat ₦200,000 plus 20% of gross income — is now completely abolished. In its place: a much wider 0% band covering the first ₦800,000 of chargeable income, and a top rate of 25% instead of 24% for the highest earners. For most low- and middle-income earners, the new system means a materially lower tax bill; for very high earners, the top marginal rate is slightly higher.
There’s also a separate, explicit exemption most people miss: anyone earning Nigeria’s national minimum wage (₦70,000/month, ₦840,000/year) or less pays no income tax at all, under Section 58 of the Act — distinct from the ordinary 0% band, though the practical effect of the two overlaps heavily since ₦840,000 sits just above the ₦800,000 band threshold.
2026 Nigeria Tax Bands
Rates apply only to the income inside each band, not your whole chargeable income — see the worked example below for how the math actually plays out.
| Chargeable income | Rate |
|---|
How We Calculate Your Tax
- If your gross annual income is ₦840,000 or less, you’re exempt as a minimum-wage earner (Section 58) — tax is ₦0, full stop.
- Otherwise, your statutory pension contribution (8% of Basic + Housing + Transport pay, or 8% of your full salary if you don’t provide a breakdown) comes off first.
- If you opted into NHF, 2.5% of your basic salary comes off next.
- Rent relief — 20% of your declared annual rent, capped at ₦500,000 — comes off next, if you pay rent.
- Any other eligible deductions you enter (NHIS, life insurance premiums, owner-occupied housing loan interest) come off last.
- What’s left is your chargeable income, which runs through the six 2026 bands above, one slice at a time, to give your total tax.
Example Calculation
Take someone earning ₦5,000,000/year with no rent relief, no NHF, and no BHT breakdown provided. Pension is 8% of the full ₦5,000,000 (the default assumption) = ₦400,000, leaving a chargeable income of ₦4,600,000. Running that through the bands: 0% on the first ₦800,000, 15% on the next ₦2,200,000 (₦330,000), and 18% on the remaining ₦1,600,000 (₦288,000) — ₦618,000 total tax, for an effective rate of 12.36% and a marginal rate of 18%. Net take-home: ₦4,382,000/year, or roughly ₦365,167/month.
Old System vs. New System: A Quick Comparison
Take someone earning ₦3,000,000/year with no rent relief and no NHF. Under the old PITA system (2025 and earlier), their Consolidated Relief Allowance was the higher of 1% of gross or ₦200,000 + 20% of gross — here, ₦800,000 — plus the same 8% pension deduction (₦240,000), leaving ₦1,960,000 taxable. Run through the old six bands (7% to 24%), that’s ₦299,600 in tax. Under the 2026 system modeled by this calculator, the same salary (default BHT assumption) produces ₦294,000 in tax — a slightly lower figure here, since the two systems roughly offset each other around the middle of the income range. The real divergence shows up at the extremes: very low earners pay dramatically less under the new law (thanks to the wider ₦800,000 0% band and the minimum-wage exemption), while very high earners (above roughly ₦50,000,000/year) face a slightly higher top marginal rate (25% vs. the old 24%).
| Old system (PITA, pre-2026) | New system (NTA, 2026+) | |
|---|---|---|
| Bands | 6 bands, 7%–24% | 6 bands, 0%–25% |
| Flat allowance | CRA: higher of 1% of gross, or ₦200,000 + 20% of gross | None — replaced by wider 0% band |
| Tax-free threshold | Effectively low (CRA-dependent) | ₦800,000 flat, plus full exemption up to ₦840,000 (minimum wage) |
| Rent relief | Not separately itemized (folded into CRA) | 20% of rent, capped ₦500,000, claimed directly |
Rent Relief, Pension & Other Deductions Explained
Pension (Pension Reform Act): 8% employee / 10% employer, calculated on Basic + Housing + Transport pay (“BHT”). Only your own 8% reduces your chargeable income. Most salary offers don’t break this down clearly, so if you don’t know your BHT split, this calculator estimates pension on your full salary — a reasonable default, but enter the real breakdown under “Add rent, pension breakdown & other deductions” for a more precise number.
Rent relief: the direct replacement for the old Consolidated Relief Allowance’s rent-adjacent component — 20% of your actual annual rent paid, capped at ₦500,000. Homeowners who don’t pay rent don’t get this deduction.
National Housing Fund (NHF): 2.5% of basic salary, now voluntary for private-sector employees since 2026 (still compulsory for federal public servants). If you opt in, it’s a deductible expense; if you don’t, there’s nothing to deduct.
Other eligible deductions: NHIS contributions, life/annuity insurance premiums on your own or your spouse’s life, and interest on a loan to develop your owner-occupied home are all deductible under Section 30 of the Tax Act — but as actual payments, not a fixed formula, so this calculator asks for the total amount rather than guessing a percentage.
Who Should Use This Calculator?
Anyone with a salaried job in Nigeria who wants a fast, realistic answer to “what will actually land in my account” under the new law — before accepting a job offer, negotiating a raise, or just understanding a new payslip. It’s built for employment income specifically; it doesn’t model business profits, capital gains, or investment income, and it doesn’t recalculate an employer’s exact month-by-month cumulative PAYE withholding (it assumes a flat, unchanging annual salary).
Important Tax-Year Information
Tax year: 2026 (the first year under the Nigeria Tax Act, effective 1 January 2026). Last verified against official sources: 2026-09-07. This calculator will be updated, re-tested, and re-dated whenever the Nigeria Revenue Service or new legislation changes any figure it uses.
Official Sources
- Nigeria Tax Act, 2025 (No. 7 of 2025) — Sections 28, 30, 58 and Fourth Schedule
- KPMG — Nigeria PIT reform flash alert
- Nigeria Revenue Service portal — 2026 tax rates guide
- National Minimum Wage (Amendment) Act, 2024 — ₦70,000/month minimum wage
Frequently Asked Questions
What are the new Nigeria income tax bands for 2026?
0% on the first ₦800,000 of chargeable income, 15% on the next ₦2,200,000, 18% on the next ₦9,000,000, 21% on the next ₦13,000,000, 23% on the next ₦25,000,000, and 25% above ₦50,000,000.
Do I still get the Consolidated Relief Allowance (CRA)?
No — it’s been abolished entirely, replaced by the wider 0% band plus itemized deductions (pension, rent relief, NHF, NHIS, life insurance, housing loan interest) claimed individually.
Is minimum wage taxed under the new law?
No. Section 58 exempts anyone earning ₦70,000/month (₦840,000/year) or less from income tax entirely — separate from, but overlapping with, the ordinary 0% band.
How is rent relief calculated?
20% of your annual rent paid, capped at ₦500,000, whichever is lower. You must declare the actual rent paid.
Is the National Housing Fund (NHF) still compulsory?
Not for private-sector employees as of 2026 — it’s voluntary. Still mandatory for federal public servants. If you opt in, the 2.5%-of-basic-salary contribution is deductible.
This calculator provides an estimate based on the tax rules and assumptions stated above. It models employment/salary income only — not business, investment, or capital gains income — and assumes a flat, unchanging annual salary rather than an employer’s exact month-by-month cumulative PAYE withholding. Your actual tax liability may differ depending on your personal circumstances. Check the Nigeria Revenue Service or a qualified tax professional for advice about your specific situation.
