What is the new Nigeria tax rate for 2026?

Under the Nigeria Tax Act 2025 (effective January 1, 2026), personal income tax uses progressive brackets from 0% (₦0–₦800,000) up to 25% (above ₦50 million). VAT remains at 7.5%. Company Income Tax is 0% for small businesses (≤₦50M turnover), 20% for medium, and 27.5% for large companies.

Who is exempt from paying tax under the new Nigerian tax law?

Individuals earning ≤₦800,000 annually (≈₦66,667/month) including minimum wage earners (₦70,000/month) pay zero personal income tax. Small companies with turnover ≤₦50 million and fixed assets ≤₦250 million are exempt from CIT, Development Levy, and Capital Gains Tax. However, professional service firms do NOT qualify for small company exemption.

What is the VAT rate in Nigeria in 2026?

The VAT rate remains at 7.5% in 2026 — the lowest among major African economies (Kenya: 16%, Ghana: 15%, South Africa: 15%). Parliament rejected proposed increases. Essential items like basic food, medicines, education, residential rent, and baby products are VAT-exempt. E-invoicing is now mandatory for VAT-registered businesses.

How is personal income tax calculated in Nigeria under the new law?

Personal Income Tax uses 6 progressive brackets: 0% on first ₦800,000, 15% on ₦800,001–₦3M, 18% on ₦3M–₦12M, 21% on ₦12M–₦25M, 23% on ₦25M–₦50M, and 25% above ₦50M. Rent relief of up to ₦500,000 (20% of annual rent) is deductible. Global income of Nigerian tax residents is now taxable under the 183-day rule.

What is the new tax reform in Nigeria about?

The 2024–2025 Tax Reform represents Nigeria's most sweeping tax overhaul in decades. Four bills signed into law in June 2025 (effective January 2026) consolidated 50+ overlapping taxes, tripled the tax-free threshold from ₦300,000 to ₦800,000, created a new Nigeria Revenue Service (replacing FIRS), introduced mandatory e-invoicing, and aligned with OECD global minimum tax standards.

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Nigeria Tax Calculator
2026 Nigeria Tax Act
Personal • Business • VAT

Calculate your tax obligations under the new Nigeria Tax Act (effective January 1, 2026). Personal Income Tax with progressive brackets, Business/CIT estimator, and 7.5% VAT calculator — all updated with the latest reform provisions.

2026 Tax Reform CompliantPIT • CIT • VATProgressive BracketsFree & UnlimitedNo Registration

Personal Income Tax Calculator (2026)

Annual Income (₦)

Under the 2026 Nigeria Tax Act, income up to ₦800,000/year is tax-free. Minimum wage earners (₦70,000/month) pay zero tax.

Based on the Nigeria Tax Act 2025 — Effective January 1, 2026. For informational purposes only. Consult a qualified tax professional.

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Understand Your Tax Under the 2026 Nigeria Tax Act

The Nigeria Tax Act 2025 (effective January 1, 2026) represents the most significant tax reform in Nigeria's history. Our free Nigeria tax calculator helps individuals and businesses understand exactly what they owe under the new progressive tax system — no registration, no fees, just accurate calculations based on the latest law.

Personal Income Tax (PAYE)

The 2026 reform tripled the tax-free threshold from ₦300,000 to ₦800,000/year. Now 6 progressive brackets from 0% to 25%. Minimum wage earners pay zero tax. Global income of Nigerian residents is now taxable. Rent relief of up to ₦500,000 is deductible.

Company Income Tax (CIT)

Small businesses (≤₦50M turnover) are fully exempt from CIT and Development Levy. Medium companies (₦50M–₦100M) pay 20%. Large companies (above ₦100M) pay 27.5%. A 4% Development Levy and 3% Tertiary Education Tax may also apply to non-small companies.

VAT at 7.5%

Nigeria VAT stays at 7.5% — the lowest in major African economies. Essential items are zero-rated (food, medicines, education, rent). E-invoicing is mandatory for VAT-registered businesses. Small business VAT exemption threshold is ₦50M turnover.

Key 2026 Reform Changes

Four new laws unified 50+ previous taxes. FIRS replaced by the Nigeria Revenue Service (NRS). Digital nomads and content creators now taxed on global income. Crypto gains are explicitly taxable. 15% global minimum tax applies to multinationals with ≥₦20B turnover.

Nigeria Tax Calculator2026 Nigeria Tax ActPersonal • Business • VAT