On a ₦500,000 monthly salary in 2026, PAYE is about ₦65,300 a month (₦783,600 a year), after 8% pension. You take home about ₦394,700. If you pay rent and claim rent relief, the tax falls. Change the figures below to match your payslip.
How the ₦500,000 Salary Tax Calculator works
- Yearly pay: ₦500,000 × 12 = ₦6,000,000.
- Pension (8%) of ₦480,000 comes off before tax.
- The first ₦800,000 is taxed at 0%, then 15%, 18% and so on.
- Rent relief, NHF and insurance reduce the tax further.
Worked example
An employee earns ₦500,000 a month and contributes 8% pension.
Yearly gross: ₦6,000,000
Pension: ₦480,000
Taxable income: ₦5,520,000
Tax: ₦783,600 a year (₦65,300 a month), top band 18%
Take-home: ₦394,700 a month
With ₦1,200,000 yearly rent claimed as rent relief, PAYE drops to ₦61,700 a month and take-home rises to ₦398,300.
Common mistakes to avoid
- Using the old 2025 tax bands
- Forgetting to claim rent relief
- Comparing take-home pay without counting pension
Need a different calculator?
Who earns about ₦500,000 a month
₦500,000 a month is typical for managers and senior specialists. Managers on ₦500,000 a month pay most of their tax in the 18% band.
How the 2026 bands apply
Your yearly taxable income of ₦5,520,000 is taxed in slices: the first ₦800,000 at 0%, the next ₦2.2 million at 15%, and the part above ₦3 million at 18%. That makes your effective tax rate 13.06% of gross pay.
Frequently asked questions
How much is PAYE on ₦500,000 a month?
About ₦65,300 a month with 8% pension and no other reliefs, under the 2026 bands.
Does rent relief reduce my tax?
Yes. With ₦1,200,000 yearly rent, PAYE on this salary is ₦61,700 a month.
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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