Nigeria Tax Act 2025 · Effective January 2026
Tax on a ₦400,000 salary in Nigeria
A ₦400,000 monthly salary (₦4,800,000 a year) pays about ₦54,500 PAYE per month before any deductions — an effective rate of 13.6%. With the typical 8% pension contribution, tax drops to about ₦48,740/month. Rent relief (20% of rent, up to ₦500,000) lowers it further.
No deductions
₦54,500/mo tax
Take-home: ₦345,500/mo
Effective rate: 13.6%
With 8% pension
₦48,740/mo tax
Take-home after pension & tax: ₦319,260/mo
Effective rate: 12.2%
Old law comparison: before 2026 this salary paid about ₦665,600/yr. Under the new law it pays ₦654,000/yr — ₦11,600 less (1.7%).
Band-by-band breakdown (no deductions)
| Band | Income in band | Tax |
|---|---|---|
| First ₦800,000 @ 0% | ₦800,000 | ₦0 |
| Next ₦2.2M @ 15% | ₦2,200,000 | ₦330,000 |
| Next ₦9M @ 18% | ₦1,800,000 | ₦324,000 |
| Total for the year | ₦4,800,000 | ₦654,000 |
What can reduce this tax?
- Pension — your 8% contribution comes off before tax.
- Rent relief — 20% of your annual rent, up to ₦500,000, is deductible.
- NHF and NHIS contributions you actually pay.
Make it exact for YOUR rent & pension →
Other salaries
₦70k₦80k₦100k₦120k₦150k₦200k₦250k₦300k₦350k₦400k₦450k₦500k₦600k₦700k₦750k₦800k₦900k₦1M₦1.2M₦1.5M₦2M₦3M₦5M₦10M
Estimate only — not tax advice. Figures assume a full calendar year. © 2026 TaxWahala.com — free, private, unofficial.