Complete Guide · Nigeria Tax Act 2026
New bands, higher exemptions, expanded reliefs — here is what the Nigeria Tax Act 2026 means for every Nigerian earner, explained in plain English.
The Nigeria Tax Act 2026, effective January 1 2026, is the most significant overhaul of Nigeria's personal income tax in years. Key changes:
| Area | Before 2026 | Nigeria Tax Act 2026 |
|---|---|---|
| Tax-free threshold | ₦300,000 | ₦800,000 ↑ |
| Highest rate | 24% | 26% |
| Consolidated Relief | ₦200,000 + 20% | ₦200,000 + 20% (retained) |
| Pension deduction | 8% | 8% (retained) |
| NHF deduction | 2.5% | 2.5% (retained) |
Bottom line: Most Nigerians earning under ₦10M/year will pay less tax in 2026 thanks to the higher ₦800,000 threshold. High earners above ₦13.8M pay slightly more on the top portion only.
Each rate only applies to income within that band — not your full salary. Bands apply to your taxable income after all reliefs.
| Band | Annual Taxable Income | Rate | Max Tax in Band |
|---|---|---|---|
| 1st | ₦0 — ₦800,000 | 0% | ₦0 — Tax Free |
| 2nd | ₦800,001 — ₦2,800,000 | 15% | ₦300,000 |
| 3rd | ₦2,800,001 — ₦5,800,000 | 18% | ₦540,000 |
| 4th | ₦5,800,001 — ₦8,800,000 | 21% | ₦630,000 |
| 5th | ₦8,800,001 — ₦13,800,000 | 24% | ₦1,200,000 |
| 6th | Above ₦13,800,000 | 26% | No cap |
A Nigerian earning ₦5,000,000 gross/year with all reliefs correctly applied:
Key insight: Without reliefs this salary faces ₦735,000 PAYE. With all reliefs: ₦385,500 — a saving of ₦349,500/year. That money belongs to you. WAKATAX calculates this automatically.
Stop guessing. WAKATAX gives you your precise PAYE, take-home, and deduction breakdown in minutes.