Income Tax Calculator — Nigeria

How Nigeria Income Tax Works

Nigeria's income tax system is based on the Pay-As-You-Earn (PAYE) system, where taxes are deducted from an employee's salary by their employer. The tax year in Nigeria runs from January 1 to December 31. The current tax rates in Nigeria range from 7% to 24%, with different tax brackets applying to different levels of income.

How to Use This Calculator

To use this calculator, you'll need to input your gross income, which is your total income before taxes. You'll also need to select your tax status, such as single, married, or head of household. Additionally, you can input any deductions or allowances you're eligible for, such as pension contributions or mortgage interest. For example, let's say you're a single person with a gross income of ₦5,000,000 per year, and you contribute 10% of your income to a pension fund. You would input these numbers into the calculator to get an estimate of your tax liability.

Key Nigeria Income Tax Rules

Some important rules to note in Nigeria include:

• Tax exemptions for certain types of income, such as dividends and interest on savings accounts
• A tax-free allowance of ₦300,000 per year for individuals
• A higher tax rate of 24% for individuals with income above ₦3,000,000 per year
• Filing deadlines: individual tax returns must be filed by March 31 of each year
• Special rules for self-employed individuals and businesses, who must file their tax returns by June 30 of each year

Common Questions

What is the tax rate for self-employed individuals in Nigeria?

The tax rate for self-employed individuals in Nigeria ranges from 15% to 20% of their net profits, depending on their level of income.

Can I claim deductions for mortgage interest in Nigeria?

Yes, you can claim deductions for mortgage interest in Nigeria, up to a maximum of ₦100,000 per year.

What is the deadline for filing tax returns in Nigeria?

The deadline for filing individual tax returns in Nigeria is March 31 of each year, while the deadline for self-employed individuals and businesses is June 30.

Are there any tax exemptions for pension contributions in Nigeria?

Yes, pension contributions are tax-exempt in Nigeria, up to a maximum of 10% of your gross income.

Do I need to file a tax return if I'm not resident in Nigeria?

If you're not resident in Nigeria, you may still need to file a tax return if you have income from Nigerian sources, such as rental income or dividends from a Nigerian company.