On a salary of ₦5,000,000 a year, take-home is about ₦3,982,000 after the 8% pension and PAYE — an effective rate of about 20.4%. Enter your own income below.
2026 PAYE tax bands
| Annual taxable income | 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% |
Reliefs: 8% pension (deductible) and rent relief = 20% of annual rent, capped at ₦500,000.
How PAYE works in Nigeria (2026)
The Nigeria Tax Act, effective 1 January 2026, makes the first ₦800,000 of annual income tax-free and replaces the old Consolidated Relief Allowance. Your employer deducts 8% pension (tax-deductible) and remits PAYE on the rest, after rent relief (20% of rent, max ₦500,000). Rates run from 15% to 25%.
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Frequently asked questions
How much income is tax-free in Nigeria in 2026?
The first ₦800,000 of annual taxable income is tax-free. After pension and rent relief, many low earners pay little or no PAYE.
What are the 2026 PAYE bands?
0% to ₦800k, 15% to ₦3m, 18% to ₦12m, 21% to ₦25m, 23% to ₦50m, 25% above.
What reliefs can I claim?
8% pension (deductible) and rent relief of 20% of rent, capped at ₦500,000.
Is this accurate for 2026?
It uses the new Nigeria Tax Act bands, 8% pension and rent relief. It's a simplified estimate excluding NHF/NHIS.
Estimates for guidance only, not tax advice. Confirm with the FIRS or your state tax authority.