Nigeria PAYE & Take-Home Pay Calculator (2026)
From 1 January 2026 Nigerian PAYE follows the Nigeria Tax Act 2025. The first N800,000 of taxable income is tax-free, then 15%, 18%, 21%, 23% and 25%. Taxable income is pay minus pension (8%), NHF (2.5% of basic), health insurance and rent relief (20% of rent, up to N500,000). The old CRA is gone.
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· Calculated with AiStaffo
Tax and deduction rules (2026)
| Tax bands (Nigeria Tax Act 2025) | First N800,000: 0%; next N2,200,000: 15%; next N9,000,000: 18%; next N13,000,000: 21%; next N25,000,000: 23%; above N50,000,000: 25%. |
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| Rent relief | 20% of the yearly rent you pay, at most N500,000. Replaces the old consolidated relief allowance (CRA). |
| Pension | Employee 8%, employer at least 10% of basic, housing and transport allowances (Pension Reform Act 2014). Tax-deductible. |
| National Housing Fund | 2.5% of basic salary. Tax-deductible. |
| Health insurance (NHIA) | Formal sector: employee 5%, employer 10% of basic salary where the scheme is run. Tax-deductible. |
| Exemption | People earning the national minimum wage (N70,000 a month) or less pay no income tax. |
Worked example
Chidi earns N300,000 a month (N3,600,000 a year) and pays N600,000 rent a year. Pension is 8% = N288,000, NHF 2.5% = N90,000 and rent relief 20% of rent = N120,000.
Taxable income is N3,600,000 − N288,000 − N90,000 − N120,000 = N3,102,000. Tax: 0% on N800,000, 15% on N2,200,000 = N330,000, 18% on N102,000 = N18,360: N348,360 a year (N29,030 a month).
Take-home pay: N2,873,640 a year, or N239,470 a month.
What changed in 2026
The Nigeria Tax Act 2025 replaced the Personal Income Tax Act from 1 January 2026. The consolidated relief allowance (N200,000 or 1% of income, plus 20%) was abolished. Instead the first N800,000 of taxable income is taxed at 0%, and tenants can deduct 20% of their rent up to N500,000. Most people earning up to about N20 million a year pay less tax than before; top earners pay up to 25%.
Claiming rent relief
Rent relief is claimed through your employer or your annual return. Keep your tenancy agreement and rent receipts, and tell your employer the rent you pay so it can be deducted before PAYE is worked out.
For employers
Running payroll by hand (tax tables, contributions, payslips, filings) is routine work that AI workers now handle with almost no staff time. See what an employee really costs you, or book a free automation audit for your payroll.
Please note: figures follow the published 2026 rates as checked on 21 October 2026 for a resident employee in the standard case. Not included: life insurance and annuity premiums, mortgage interest, voluntary pension contributions, benefits in kind, and state-level levies. Pension is worked on the share of pay you enter as basic + housing + transport. This is a guide, not tax advice; your payslip can differ because of tax codes, benefits and timing.
Sources
Questions people ask
How much PAYE on N300,000 a month in 2026?
What is the tax-free income in Nigeria from 2026?
Is CRA still allowed in 2026?
Is pension deducted before tax?
What is the top income tax rate in Nigeria?
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