How Nigeria PAYE Tax Works (2026)

PAYE (Pay As You Earn) is the system used to collect personal income tax in Nigeria. If you earn a salary in Nigeria, your employer deducts PAYE tax before paying your salary.

Nigeria PAYE Tax Bands (2026)

Nigeria uses a progressive tax system. This means:

• The first ₦800,000 is tax-free
• Higher income portions are taxed at higher rates

Example: ₦300,000 Monthly Salary

₦300,000 monthly equals ₦3,600,000 per year. Only the portion above ₦800,000 is taxed.

This means you do not pay tax on your full salary. PAYE tax is calculated step by step using tax bands.

What Reduces PAYE Tax in Nigeria?

• Pension contributions
• Rent relief (where applicable)
• Other approved deductions

Calculate Your Nigeria Tax Instantly

Instead of guessing, you can use our free calculator to see:

• Annual tax
• Monthly tax
• Monthly take-home pay

👉 Use the Nigeria Tax Calculator 2026

Disclaimer: This article is for educational purposes only.