Nigerian income tax is deducted at source under the PAYE system and remitted to the FIRS or your State Internal Revenue Service.
The 2026 change
Under the Nigeria Tax Act 2025, effective 1 January 2026, employees earning NGN 800,000 per year or less are fully exempt from PAYE.
That is a significant change for lower-paid workers.
The CRA is gone
The Consolidated Relief Allowance has been abolished and replaced with a Rent Relief, capped within a defined range.
If you were used to seeing CRA on your payslip or in tax computations, that line no longer applies.
Progressive rates
PAYE remains progressive: each band of income is taxed at its own rate, rather than the whole amount being taxed at the top rate that applies to you.
The remittance deadline
Employers must remit PAYE by the 10th day of the following month. Late remittance attracts a 10% annual fine plus interest, and there are penalties for late filing.
That deadline is the employer's obligation, not yours — but a pattern of late remittance is a warning sign about the employer's finances.
Allowances and your package
Nigerian pay packages are typically built from a basic salary plus allowances: housing (often 50-60% of basic), transport, meal, education and utilities.
These are not statutory — they are market practice, and they are highest in Lagos and Abuja because of cost of living.
The structure matters because pension contributions are calculated only on basic plus housing plus transport.
Payment frequency
Pay may be monthly, bi-monthly or weekly, and may be in naira or an agreed foreign currency where the contract provides for it.
What to check on your payslip
That the basic-to-allowance split is what you agreed, that pension is calculated correctly, and that PAYE reflects the current rules rather than the pre-2026 regime.