Is Nigeria's new tax law for you?

If you work for a Nigerian Company: Your employer is legally mandated to calculate and deduct your Personal Income Tax (PAYE) from your monthly salary before paying you. At the end of the year, you must still file a Self-Assessment Return. If your employer calculated correctly, your tax balance will be ₦0.00. You generally only pay a ‘balance’ if you have extra income (from freelancing or side-business profits) that your employer did not tax.

If you earn from a Foreign Company (Remote Work/Freelancing): Your foreign employer cannot deduct Nigerian tax for you. You are now legally required to:

1. Calculate your own tax using the new Progressive Tax Bands (0% - 25%).
2. Pay the tax yourself directly to the State Internal Revenue Service (Direct Assessment).
3. Declare this foreign income in your annual return, as the NTA 2025 explicitly taxes the ‘worldwide income’ of all Nigerian residents.

Gifts and inheritances are tax exempt — If your father passes away *God forbid* and leaves you a house in Ikoyi, or your aunt gifts you ₦5 million cash for your wedding, the government takes ₦0.00 from that transaction. However, if you now receive rental income for the house, you will pay tax on that. If you decide to sell the gift/inheritance later, you pay tax on the profit.