Guides · Compliance
Nigeria tax laws & recent updates
A readable summary for individuals navigating PIT, reliefs, and digital-asset rules — with a path to our Nigeria tax calculator.
What shapes Nigerian personal tax today
This page is a high-level overview for founders, freelancers, and crypto earners — not legal advice. Laws change; verify with official gazettes, FIRS notices, and a qualified adviser.
Signed into law on 26 June 2025, the NTA 2025 is the most significant Nigerian tax reform in over a decade. It replaces the Personal Income Tax Act (PITA) and consolidates multiple tax laws into a single, unified legislation. Effective from 1 January 2026, it introduces new progressive income bands, removes the Consolidated Relief Allowance (CRA), and merges capital gains tax into the personal income tax framework.
All Nigerians earning up to ₦800,000 annually are now fully exempt from personal income tax under the NTA 2025. This zero-rate band was introduced to protect low-income and minimum-wage earners, replacing the old 7% first-band rate that applied from the first naira.
The Consolidated Relief Allowance (CRA) — previously calculated as max(₦200,000, 1% of gross) + 20% of gross — has been abolished. In its place, resident individuals who pay rent may deduct 20% of their annual rent, capped at ₦500,000. Homeowners and non-renters receive no equivalent personal relief beyond the ₦800,000 tax-free band.
From 2026, the separate 10% Capital Gains Tax (CGT) rate has been abolished. Capital gains — including gains from digital assets and crypto — are now added to taxable income and taxed at the same progressive NTA 2025 rates. This change significantly increases the effective tax rate on high-value gains.
The NTA 2025 explicitly confirms that Nigerian tax residents are liable on their worldwide income regardless of where it arises or whether it is remitted to Nigeria. A resident is defined as someone domiciled in Nigeria, having a permanent home here, maintaining family/economic ties, or spending 183+ days in Nigeria in a 12-month period.
Federal taxes are administered by the Federal Inland Revenue Service (FIRS); states operate State Internal Revenue Services (SIRS) for state-level PAYE collections. Many filings and receipts flow through TaxPro-Max — PayPit is built to align with these workflows and FIRS compliance expectations.
NTA 2025 progressive bands
2026 and beyondTax is applied slice-by-slice across each band. The ₦800,000 tax-free threshold means low-income earners pay zero PIT. Capital gains are now included in taxable income.
| Band | Marginal rate | Note |
|---|---|---|
| First ₦800,000 | 0% (exempt) | Tax-free threshold |
| Next ₦2,200,000 (up to ₦3m) | 15% | |
| Next ₦9,000,000 (up to ₦12m) | 18% | |
| Next ₦13,000,000 (up to ₦25m) | 21% | |
| Next ₦25,000,000 (up to ₦50m) | 23% | |
| Above ₦50,000,000 | 25% | Top rate |
PITA Sixth Schedule (reference)
Tax years 2025 and earlierUsed for historical assessment and any outstanding 2025 liabilities. CRA was applied before these bands. Rates started at 7% from the first naira of taxable income.
| Band | Marginal rate |
|---|---|
| First ₦300,000 | 7% |
| Next ₦300,000 | 11% |
| Next ₦500,000 | 15% |
| Next ₦500,000 | 19% |
| Next ₦1,600,000 | 21% |
| Above ₦3,200,000 (remainder) | 24% |
Legacy CRA formula: max(₦200,000, 1% of gross) + 20% of gross annual income.
Try the numbers
Our free calculator supports both the NTA 2025 (2026+) and the legacy PITA regime. Select your tax year to see the right bands and reliefs.