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Let me explain the NEW TAX LAW.
First of all, you are being taxed progressively according to your PERSONAL income.
If you earn N800k per year and below, you pay 0% tax
N800k to 3M, 15%
N3M to 12M, 18%
N12M to 25M, 21%
N25M to N50M, 23%
Above N50M, 25%
For instance, if you earn N10M a year, you fall inside the 18% category, so you will be expecting to pay N1.8M (N1.8M is 18% of N10M) as tax but it doesn't work like that, let me explain!
You will pay zero tax for the first N800k you receive inside the N10M
Then the next N800k to N3M you receive, you will pay 15% of it.
Finially, you will now pay 18% of the remaining N7M.
Another example, For someone earning like N60M a year, he or she won't pay 25% tax outrightly, the tax will be removed progressively at each level and 25% will only be taken from the last N10M inside the N60M.
Also, RENT RELIEF is a part of the new tax policy, so each individual will be given a 20% rent relief (but this is capped at N500k)
So it means, 20% of your rent will be minus from your personal income before it is taxed.
For instance, if your rent is N1M per year and your personal income is N10M.
20% of your rent is N200k.
Your entire N10M won't be taxed, instead what will be taxed is (N10M - N200k = N9.8M).
So the rent relief will be minus from your income before being taxed.
Also other relief like Life assurance, pension, housing fund, health insurance are also being deducted before your income will be taxed.
All this applies to personal income, especially salaries, for business income, small businesses with a turn over of N100M or less won't be taxed, but freelancers, employee and every other personal income above N800k per year will be taxed.
Prepare for 2026!
-Oruka OtueneLet me explain the NEW TAX LAW. First of all, you are being taxed progressively according to your PERSONAL income. If you earn N800k per year and below, you pay 0% tax N800k to 3M, 15% N3M to 12M, 18% N12M to 25M, 21% N25M to N50M, 23% Above N50M, 25% For instance, if you earn N10M a year, you fall inside the 18% category, so you will be expecting to pay N1.8M (N1.8M is 18% of N10M) as tax but it doesn't work like that, let me explain! You will pay zero tax for the first N800k you receive inside the N10M Then the next N800k to N3M you receive, you will pay 15% of it. Finially, you will now pay 18% of the remaining N7M. Another example, For someone earning like N60M a year, he or she won't pay 25% tax outrightly, the tax will be removed progressively at each level and 25% will only be taken from the last N10M inside the N60M. Also, RENT RELIEF is a part of the new tax policy, so each individual will be given a 20% rent relief (but this is capped at N500k) So it means, 20% of your rent will be minus from your personal income before it is taxed. For instance, if your rent is N1M per year and your personal income is N10M. 20% of your rent is N200k. Your entire N10M won't be taxed, instead what will be taxed is (N10M - N200k = N9.8M). So the rent relief will be minus from your income before being taxed. Also other relief like Life assurance, pension, housing fund, health insurance are also being deducted before your income will be taxed. All this applies to personal income, especially salaries, for business income, small businesses with a turn over of N100M or less won't be taxed, but freelancers, employee and every other personal income above N800k per year will be taxed. Prepare for 2026! -Oruka Otuene·444 Views ·0 Reviews -
*FROM NEXT MONTH KINDLY TAKE NOTE OF THE FOLLOWING AND ADHERE STRICTLY TO IT.*
Tax is not about money entering your account. Tax is about what that money actually is.
If you describe money wrongly, it may look like income, and you pay more tax.
If you describe it correctly, you only pay tax when required... and nothing extra.
Let me show you how you can use descriptions to minimise taxes legally
SIMPLE DESCRIPTIONS YOU CAN USE (LEGALLY)
1. Money that is NOT income (NO TAX)
Use these when the money is not payment for work or business.
SituationDescription to use:
1. When a Family member sends you money, they should write "Gift / Family support"
2. When a Friend pays you back your money, he or she should write:"Refund / Reimbursement"
3. When you move your own money to another account, write:"Personal transfer / savings."
4. When someone lends you money, he or she should write: "Loan received"
5. If you put your own money into business, write: "Capital contribution"
These do not attract tax when they are true.
Let's be guided.*FROM NEXT MONTH KINDLY TAKE NOTE OF THE FOLLOWING AND ADHERE STRICTLY TO IT.* Tax is not about money entering your account. Tax is about what that money actually is. If you describe money wrongly, it may look like income, and you pay more tax. If you describe it correctly, you only pay tax when required... and nothing extra. Let me show you how you can use descriptions to minimise taxes legally SIMPLE DESCRIPTIONS YOU CAN USE (LEGALLY) 1. Money that is NOT income (NO TAX) Use these when the money is not payment for work or business. SituationDescription to use: 1. When a Family member sends you money, they should write "Gift / Family support" 2. When a Friend pays you back your money, he or she should write:"Refund / Reimbursement" 3. When you move your own money to another account, write:"Personal transfer / savings." 4. When someone lends you money, he or she should write: "Loan received" 5. If you put your own money into business, write: "Capital contribution" These do not attract tax when they are true. Let's be guided.1
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