From January 2026, PAYE uses new bands: the first ₦800,000 a year is tax-free, then 15% up to ₦3 million, 18% up to ₦12 million, 21% up to ₦25 million, 23% up to ₦50 million and 25% above. Pension and NHF come off first, and rent you pay gives relief of 20% (up to ₦500,000). Enter your pay below.
How the PAYE Tax Calculator works
- Enter your gross monthly pay.
- Keep pension on (8% of basic, housing and transport) unless you are not in a pension scheme.
- Add yearly rent for rent relief, and NHF or insurance if you pay them.
- See monthly PAYE, take-home pay, your effective rate and the tax in each band.
Worked example
An accountant earns ₦350,000 a month and pays ₦1,200,000 rent a year.
Yearly gross: ₦4,200,000
Pension (8%): ₦336,000
Rent relief: ₦240,000
Taxable income: ₦3,624,000
Tax for the year: ₦442,320, which is ₦36,860 a month
Take-home pay: ₦285,140 a month
Common mistakes to avoid
- Still using the 2025 bands and the consolidated relief allowance
- Not claiming rent relief
- Working out pension on total gross when the company uses basic, housing and transport only
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What changed in 2026
The Nigeria Tax Act 2025 replaced the old bands (7% to 24%) and the consolidated relief allowance. Many low and middle earners pay less than under the old rules, while the top band rose to 25%. Rent relief is new, so tell your employer what you pay and keep your rent receipt or tenancy agreement.
Employers: remitting PAYE
Employers deduct PAYE each month and pay it to the tax authority of the state where the employee lives, by the monthly deadline. Use this calculator to check payslips, but run payroll with proper software or an accountant.
Frequently asked questions
How much salary is tax-free in Nigeria in 2026?
The first ₦800,000 of yearly taxable income is taxed at 0%, and people earning the national minimum wage or less are exempt.
How do I claim rent relief?
Give your employer your rent receipt, tenancy agreement or an approved rent declaration. Relief is 20% of yearly rent, up to ₦500,000.
Are these the latest tax rules?
They follow the Nigeria Tax Act 2025, which took effect on 1 January 2026, and were last checked on the date shown on this page. Tax rules can change, so confirm big decisions with a tax adviser or the Nigeria Revenue Service.
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