Total reliefs and the tax they save.
Tax saved
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Total reliefs
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Rent relief
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Tax with reliefs
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Tax without
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Reliefs shrink the income that gets taxed
A relief is not a discount on your tax bill. It is a deduction from the income that the bands are applied to. You list what you spent on certain protected items over the year, the total comes off your gross income, and only the smaller figure that remains gets taxed. That is why the same NGN 100,000 of relief is worth more to a higher earner: it is shaved off their top band, where the rate is steeper. This calculator adds up your eligible reliefs, recomputes your tax on the reduced income, and shows the difference against paying with no reliefs at all. It is aimed at salaried individuals working out what claiming their full entitlements is worth.
From the old blanket allowance to itemised claims
The 2025 reform changed the shape of this entirely. The old system gave almost everyone a single consolidated relief allowance calculated as a percentage of gross pay. That blanket allowance is gone. In its place is an itemised list: pension contributions, the National Housing Fund, the national health insurance contribution, interest on a loan for an owner-occupied home, life-insurance or annuity premiums, and a new rent relief. You now claim what you actually pay into those buckets rather than a flat percentage. These are the deductible items the calculator recognises, and the structure is the safe part to rely on; confirm the exact eligible list with the FIRS (Federal Inland Revenue Service) and your state internal revenue service, because the detail is still bedding in.
The rent relief is capped, and the cap bites early
Rent relief is the one most people misjudge. The calculator applies 20 percent of the annual rent you pay, but caps the deduction at NGN 500,000. The cap is reached at NGN 2.5 million of rent, because 20 percent of NGN 2.5 million is exactly NGN 500,000. Pay more rent than that and the extra buys you no further relief. So a tenant paying NGN 4 million a year claims the same NGN 500,000 as one paying NGN 2.5 million. This is the 20 percent rate and the NGN 500,000 ceiling the tool uses; verify both against current guidance before you file.
A NGN 6 million earner claiming three reliefs
Here is a full case you can reproduce in the form. Take gross income of NGN 6,000,000, with pension of NGN 480,000, National Housing Fund of NGN 75,000, and annual rent of NGN 1,200,000. The rent relief is 20 percent of NGN 1,200,000, which is NGN 240,000, comfortably under the cap. Total reliefs come to NGN 795,000. That drops your chargeable income to NGN 5,205,000. Tax on that is NGN 726,900, against NGN 870,000 with no reliefs, a saving of NGN 143,100.
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The chart puts the two tax bills side by side. The shorter bar is what you owe after claiming, and the dark cap on the taller bar is the NGN 143,100 the reliefs wipe out.
The shortcut that only works inside one band
You will sometimes see the saving described as simply reliefs times your marginal rate. In this example that holds exactly: NGN 795,000 at the 18 percent marginal rate is NGN 143,100. It works here because the whole NGN 795,000 of relief is carved off income that sat inside the 18 percent band. The shortcut quietly breaks the moment your relief pulls income across a band boundary. If part of the deduction drops you out of the 18 percent band and into the 15 percent band, that lower portion only saves you 15 percent, so the true saving is less than the simple multiplication suggests. When your income sits near a threshold, trust the calculator's full recomputation rather than the rule of thumb.
Can I claim rent relief and a housing-loan deduction together?
They are separate items and the calculator lets you enter both, since one is for tenants paying rent and the other is for owners servicing a loan on a home they live in. In practice few people are paying rent and a mortgage on an owner-occupied home in the same year, so claiming both should reflect a genuine situation. Keep your tenancy agreement and loan statements, because your state revenue service can ask you to substantiate each claim.
Do voluntary pension top-ups count as relief?
The pension figure here is meant to capture your deductible contributions. Mandatory contributions clearly qualify, and additional voluntary contributions are often deductible too, but the treatment of voluntary top-ups has conditions and has been a moving target under the reform. Enter what you are confident is deductible, and confirm the current position on voluntary contributions with the FIRS before claiming aggressively, especially if you withdraw the voluntary portion early.