26/09/2025
From January 1, 2026
1️⃣ If your annual income is ₦800,000 or less, you won’t pay PIT (Personal Income Tax).
If your income is above ₦800,000, only the amount above ₦800,000is taxed, using the progressive tax rates (starting around 7%). Everyone enjoys the ₦800k relief.
2️⃣ Severance pays, gratuity, or compensation benefits will enjoy higher tax-free allowances. In some cases, the entire amount may be tax-free.
Meaning, if you lose your job, get laid off, or suffer an injury and your organisation pays you compensation, a larger chunk (or in some cases, the full amount) of those payments will not be taxed.
3️⃣ Contributions remain tax-free. That is, Savings into Pension Accounts, NHF (National Housing Fund), and Health Insurance remain exempt from tax.
4️⃣ PAYE Is Lighter. That is, employers still deduct PAYE (Pay As You Earn) tax monthly, but for low- or average-income earners, the amount deducted is now lighter than before.
5️⃣ There Will Be Digital Filing & Faster TCC. That is, Tax filing has gone digital. You can now file taxes online and apply for a Tax Clearance Certificate (TCC) faster, for things like visas, loans, or government contracts.
Okay. Let me add at least one more:
6️⃣ There’s now Higher Taxes on Luxury Items. That is, according to the government, luxury goods like alcohol, to***co, and expensive cars now attract higher excise duties. The government says high-income earners who can afford these items will have to pay more.
✅NOTE: These are just for knowledge’s sake. If you need more for decision-making, kindly consult a tax consultant.