Gross income less Section 30(2) reliefs.
Chargeable income
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Total reliefs
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Rent relief
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Income tax
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Your breakdown
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The number the tax bands actually read
People assume tax is charged on their salary. It is not. In Nigeria the progressive bands apply to chargeable income, which is your gross income after the deductible reliefs the law allows. Get this base wrong and every figure downstream, your PAYE, your effective rate, your net pay, is wrong too. This calculator does one job well: it takes your gross, subtracts the reliefs you enter, and shows the chargeable income that the bands then act on, plus the tax that results.
The gap between gross and chargeable can be large. The reliefs are not rounding; for a middle earner they can shave a meaningful slice off the taxable base, and because the bands are progressive, each naira of relief saves tax at your top rate. That is why understanding chargeable income is the single most useful thing a Nigerian taxpayer can learn.
The reliefs the calculator subtracts
The framework that followed the 2025 reform lists the deductions allowed against gross income, and this tool models them: pension contributions, the National Housing Fund, the national health insurance scheme contribution, owner-occupied housing-loan interest, life-insurance or annuity premiums, and rent relief. Most are deducted at the amount you actually paid. Rent relief is the one with its own formula. As modelled here it is the lower of 20 percent of your annual rent or NGN 500,000, so rent above NGN 2.5 million a year stops adding to the relief once the cap bites. Enter what you genuinely paid for each line; these are the figures the calculator applies, and you should confirm the current relief list and the rent cap with the FIRS or your state internal revenue service, since the reform is still adjusting them.
Stripping a real salary down to its taxable base
Take gross income of NGN 9,000,000, with a pension contribution of NGN 540,000, NHF of NGN 90,000, and annual rent of NGN 1,200,000. Rent relief is 20 percent of NGN 1,200,000, which is NGN 240,000, comfortably under the NGN 500,000 cap, so the full NGN 240,000 counts. Total reliefs are NGN 540,000 plus NGN 90,000 plus NGN 240,000, which is NGN 870,000. Chargeable income is NGN 9,000,000 less NGN 870,000, or NGN 8,130,000. The income tax on that base, using the rates this calculator applies, is NGN 1,253,400. Without the reliefs, the bands would have charged tax on the full NGN 9,000,000, which is why the relief lines are worth getting right.
Where people get chargeable income wrong
Two errors recur. The first is claiming rent relief on the full rent rather than 20 percent of it; the relief is a fraction of the rent, capped, not the rent itself. The second is double counting a contribution that an employer already deducted before paying you. If your pension is taken at source and your gross figure is already net of it, do not subtract it again here. When in doubt, use your annual gross before any deductions as the gross input, then let each relief line do the subtracting once. This tool is for employees checking their own position, freelancers preparing to file, and anyone who wants to see how much a new relief, say starting to contribute to a pension, would cut their tax.
Is the first part of my income tax-free?
Yes, in effect. The lowest band the calculator applies charges 0 percent, so a first slice of chargeable income carries no tax. The figure this tool uses for that tax-free floor is NGN 800,000 of chargeable income. Confirm the current floor with the FIRS or your state internal revenue service, because the 2025 reform changed it and further adjustments are possible.
Does chargeable income include rental or investment income?
It can. Chargeable income is meant to capture your total income subject to personal tax, not only salary, so rent you receive or other taxable income belongs in the gross figure before reliefs. This calculator works from whatever gross you enter, so include all the income that should be taxed, then deduct the reliefs that apply. For the precise scope of what counts, check FIRS guidance.