Nigeria PAYE & net-salary calculator
Updated for the Nigeria Tax Act 2025 — first ₦800,000 tax-free, 15–25% bands, pension on Basic + Housing + Transport, NHF, NHIS and the new rent relief. Enter a salary to see take-home pay and PAYE instantly.
Estimate under the Nigeria Tax Act 2025 (effective Jan 2026). Not tax advice — confirm with your payroll team.
Employer also contributes ₦50,000/mo (pension 10% of BHT).
How PAYE is calculated in Nigeria (2025)
The Nigeria Tax Act 2025 took effect on 1 January 2026 and changed how PAYE is computed. Here's the method this calculator uses.
1 · Subtract eligible deductions
Pension (8% of Basic+Housing+Transport), NHF (2.5% of gross), NHIS (5% of basic), mortgage interest, rent relief and life-insurance premium come off your income first.
2 · Apply the bands
What's left — taxable income — is taxed in progressive slices: the first ₦800,000 is tax-free, then 15%, 18%, 21%, 23% and 25% on higher slices.
3 · Take-home
Take-home pay is gross minus the statutory deductions taken from your payslip (pension, NHF, NHIS) and the PAYE due. Reliefs like rent reduce tax but aren't payslip deductions.
NTA-2025 PAYE bands
| Band | Monthly (₦) | Annual (₦) | Rate |
|---|---|---|---|
| 1 | First ₦66,666.67 | First ₦800,000 | 0% |
| 2 | Next ₦183,333.33 | Next ₦2,200,000 | 15% |
| 3 | Next ₦750,000 | Next ₦9,000,000 | 18% |
| 4 | Next ₦1,083,333.33 | Next ₦13,000,000 | 21% |
| 5 | Next ₦2,083,333.33 | Next ₦25,000,000 | 23% |
| 6 | Above ₦4,666,666.67 | Above ₦50,000,000 | 25% |
What's deducted, and on what basis
Each contribution has its own base — this is the part most calculators get wrong.
| Contribution | Employee | Employer | Based on | Condition |
|---|---|---|---|---|
| Pension | 8% | 10% | Basic + Housing + Transport | Contributory Pension Scheme |
| NHF | 2.5% | — | Gross salary | Optional in the private sector |
| NHIS | 5% | 10% | Basic salary | Employers with 10+ employees |
Independent consultants are subject to 5% Withholding Tax (WHT), not PAYE.
The six deductions from taxable income
These reduce the income PAYE is charged on. Relevant documents may be required to claim them.
Source: SME Payroll — Nigeria Tax Reform. This tool is a guide, not tax advice.
One person at a time isn't payroll.
Vintage People applies every one of these rules — the right base for each contribution, every relief, every exemption — across your entire payroll, effective-dated and audit-logged.
See Vintage PayrollWhy bases matter
Pension is 8% of Basic + Housing + Transport, NHIS is 5% of basic, and NHF is 2.5% of gross. Getting the base wrong quietly under- or over-deducts on every payslip, every month.
Common questions
Neither exactly — the employee's 8% pension is calculated on Basic + Housing + Transport (BHT), not total gross. The employer adds 10% on the same base. That's why this calculator asks what share of your gross is BHT.
Under the Nigeria Tax Act 2025, the first ₦800,000 of annual taxable income is taxed at 0%. National minimum-wage earners are fully exempt.
Rent relief replaced the Consolidated Relief Allowance (CRA). It's 20% of the annual rent you pay, capped at ₦500,000, deducted from income before PAYE. Documents may be required.
NHF is 2.5% of gross salary (optional in the private sector). NHIS is 5% of basic salary for the employee, where the employer has 10 or more employees (employer adds 10%).
No — it's a free estimate built to the published NTA-2025 rules. For payslips you can file, Vintage People applies the same rules across your whole payroll with a full audit trail.
Payroll for everyone on your team
See these rules applied to your whole company — accurate, compliant and updated the day the law changes.