PAYE Tax Calculator Nigeria 2026
PAYE Tax Calculator
Monthly PAYE and take-home pay under the 2026 tax law (last verified 2026-07-04).
Enter your monthly gross pay to see your PAYE and take-home.
How it works
Under the Nigeria Tax Act 2025 (effective 1 January 2026), your PAYE is worked out in steps: start with your annual gross pay, subtract your deductible pension contribution (8% of Basic + Housing + Transport) and, if you opt in, National Housing Fund contributions (2.5% of basic salary). Then subtract your rent relief — 20% of the annual rent you pay, capped at ₦500,000 — which replaced the old Consolidated Relief Allowance (CRA). What's left is your chargeable income, taxed progressively: 0% on the first ₦800,000, then 15%, 18%, 21%, 23% and 25% on higher bands.
Worked example: someone earning ₦500,000/month gross (₦6,000,000/year), with ₦250,000 basic, ₦100,000 housing and ₦50,000 transport monthly, paying ₦1,200,000 in annual rent. Pension: 8% of (₦250k+₦100k+₦50k)×12 = ₦384,000. Rent relief: 20% of ₦1,200,000 = ₦240,000 (under the ₦500,000 cap). Chargeable income: ₦6,000,000 − ₦384,000 − ₦240,000 = ₦5,376,000. Running that through the bands gives an annual tax of ₦757,680 — about ₦63,140 a month — leaving a net monthly take-home of around ₦404,860 after pension and tax.
Anyone earning at or below the national minimum wage (₦70,000/month) pays no PAYE at all under the new law. Toggle "Compare with old law" to see what the same income would have paid under the previous PITA regime, which taxed from the first naira and used a CRA of 20% of gross income plus a flat ₦200,000.
Frequently asked questions
What changed in the 2026 Nigerian tax law?
The tax-free threshold rose from ₦300,000 to ₦800,000 of chargeable income. The old Consolidated Relief Allowance (20% of gross + ₦200,000) was replaced with a rent relief of 20% of annual rent paid, capped at ₦500,000 — available to tenants only. Tax bands were also restructured, topping out at 25% above ₦50 million.
Do I get rent relief if I own my home?
No — the rent relief allowance under the Nigeria Tax Act 2025 is available only to tenants who pay rent for residential accommodation. Homeowners without rental obligations don't qualify for this specific relief.
Is NHF contribution compulsory?
NHF is statutorily 2.5% of basic salary under the NHF Act, though enforcement for private-sector employees is inconsistent in practice — many treat it as voluntary outside the public sector. Check your employer's payroll policy; this calculator lets you toggle it on or off.
What if I earn the minimum wage or less?
Employees earning at or below the national minimum wage (₦70,000/month) are exempt from PAYE entirely under the 2026 law — no deduction, no matter your other allowances.
Does this account for bonuses, gratuity or benefits-in-kind?
No — this calculates PAYE on regular salary (basic, housing, transport and gross pay) only. Bonuses, taxable gratuity and benefits-in-kind (like company-provided accommodation) follow their own valuation rules under the new Act and aren't included here.
Where do these figures come from?
The tax bands, rent relief cap, and pension/NHF treatment were verified against PwC Worldwide Tax Summaries, an EY global tax alert, and Nigerian press coverage of the Nigeria Tax Act 2025, last checked 2026-07-04. See the disclaimer below for the full source list.