CIT and the Development Levy in one bill.
Total corporate tax
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Company income tax
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Development levy
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Effective rate
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Two charges, one corporate tax bill
A Nigerian company does not pay a single income tax. It pays companies income tax on its profit and, separately, a development levy on the same profit. Looked at in isolation each seems modest, but together they set the real cost of being profitable. This calculator adds both into one figure and works out the blended effective rate, so a finance lead or founder can see the true tax cost of a year's assessable profit rather than two charges they have to remember to combine. Enter the profit, the turnover, and the fixed assets, and the tool decides which regime applies.
First the size test, then the rate
Before any rate is applied, the tool runs a size test, because small companies are treated very differently. A company counts as small only if its turnover is at or below NGN 50 million AND its total fixed assets are at or below NGN 250 million. Both conditions have to hold. Pass the test and the company pays neither companies income tax nor the development levy, an effective rate of 0 percent. Fail it on either limb and the full regime applies. This two-condition test is the structure the 2025 reform put in place, and it is the stable part to understand; the exact thresholds are the ones this calculator applies, so confirm them with the FIRS (Federal Inland Revenue Service), which assesses companies income tax.
The headline rate for everyone else
A company that is not small pays companies income tax at the rate this calculator applies, which is 30 percent of assessable profit, plus the development levy at 4 percent of the same profit. Stacked together that is a combined headline burden of 34 percent of assessable profit. The development levy is itself a consolidation: it rolls several older levies, including the tertiary education tax and the technology levy, into one charge, which is why you see a single 4 percent line rather than a handful of smaller ones. The 30 percent rate can be reduced by order in future, so treat it as the figure the tool models today and verify the live rate with the FIRS.
A company with NGN 50 million of profit
Take a company with NGN 50 million of assessable profit, NGN 200 million of turnover, and NGN 120 million of fixed assets. Its turnover exceeds the NGN 50 million ceiling, so it fails the small-company test and the full regime applies. Companies income tax at 30 percent is NGN 15 million. The development levy at 4 percent is NGN 2 million. The total corporate tax is NGN 17 million, a blended effective rate of 34.00 percent on the profit.
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The chart shows the assessable profit divided into what the company keeps and what the two charges take, with the development levy as the thin dark slice sitting on top of the larger companies income tax block.
The cliff at the small-company line
The sharpest planning point is that the small-company threshold is a cliff, not a ramp. A company sitting just under both limits pays nothing. Nudge turnover one naira over NGN 50 million, or let fixed assets cross NGN 250 million, and the same profit suddenly attracts the full 34 percent. There is no gentle taper between the two states. That makes the year you scale past the threshold a genuine inflection in your tax cost, and it rewards planning the timing of large asset purchases and revenue recognition rather than drifting across the line unaware. Because both tests must be satisfied, a capital-heavy business can lose small-company status on the asset limb even with modest turnover.
Why is profit not part of the small-company test?
The size test looks at turnover and fixed assets, not at how profitable the company is. A business can have high turnover and slim profit yet still fail the test and pay the full rate, because the thresholds are about scale, not margin. The profit only drives the amount of tax once the test has decided which rate applies. If your turnover is comfortably under NGN 50 million and your assets under NGN 250 million, even a strong-profit year stays at 0 percent under the structure this tool models. Confirm the live thresholds with the FIRS.
Does the development levy apply to small companies too?
No. The same small-company test that exempts a qualifying business from companies income tax also exempts it from the development levy. That is why the tool shows zero for both when the size test is met, rather than charging the 4 percent levy on its own. The levy and the income tax move together off the back of the single size test. For larger companies the levy is an additional charge on assessable profit, so it is not a substitute for the income tax but a layer on top of it.