Personal Income Tax Rates
Relevant Tax Laws:
- Personal Income Tax Amendment Act 2011.
Taxable Income Band |
Tax Rate |
Tax on Band |
Cummulative
Charge Profit |
Cummulative
Tax |
First |
300,000.00 |
7% |
21,000.00 |
300,000.00 |
21,000.00 |
Next |
300,000.00 |
11% |
33,000.00 |
600,000.00 |
54,000.00 |
Next |
500,000.00 |
15% |
75,000.00 |
1,100,000.00 |
129,000.00 |
Next |
500,000.00 |
19% |
95,000.00 |
1,600,000.00 |
224,000.00 |
Next |
1,600,000.00 |
21% |
336,000.00 |
3,200,000.00 |
560,000.00 |
Over |
3,200,000.00 |
24% |
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Minimum Tax
2% of Gross Income
Personal Income Tax Reliefs
There will be a consolidated tax free
allowance of N200,000 or 2% of gross income
whichever is higher plus
20% of the gross emolument
NB:
Gross emolument is defined to include benefits in kind, gratuities,
superannuation and any other incomes derived solely by reason of
employment
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Penalties for Non-Compliance
Failure by the employer to deduct tax from the employee attracts penalty of 10% and Interest at commercial rate (currently 21%) along with the principal amount payable.
Rendering of incorrect/false returns attracts, on conviction, a fine of N200 and double the amount of tax undercharged.
Withholding Taxes
Relevant Tax Laws:
- Companies And Allied Matters Act 1990
- Personal Income Tax Act
- Tax regulations introduced from time to time by minister of finance
Rates of Withholding tax for companies are as follows:
Dividend, Interest & Rent |
10.00% |
Royalties |
10.00% |
Commissions, Consultancy, Technical & Management |
10.00% |
Construction |
5.00% |
All types of contracts & agency arrangement ,other than sales
in the ordinary course of business |
5.00% |
Sales in the ordinary course of business |
5.00% |
Directors’ Fees |
10.00% |
|
|
Company Income Tax Rate
Relevant Tax Laws:
- Companies And Allied Matters Act 1990
1st Jan 1996 – Date
|
• 30%
• 20% for Small business with annual turnover of less than N5million |
| Education Tax |
2% |
Capital Allowances
The amount of capital allowance to be enjoyed in any year of assessment is restricted in Nigeria to a percentage of assessable profit. The following is a schedule for the sectors:
Tax Allowance |
Initial % |
Annual % |
Building Expenditure |
15 |
Nil |
Industrial Building Expenditure |
15 |
Nil |
Mining |
95 |
Nil |
Plant |
|
|
i. (Agric prod) |
95 |
Nil |
ii. Others |
50 |
20 |
Furniture fittings |
25 |
20 |
Motor Vehicles |
|
|
i. Public transpoprtation |
95 |
Nil |
ii. Others |
50 |
25 |
Housing Estate |
50 |
25 |
Ranching/Plantation |
30 |
50 |
R & D |
95 |
Nil |
Agro |
Additional |
|
Plants/Equipment |
Invest. |
Nil |
Leased |
Allowance 10% |
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For more information visit www.firs.gov.ng
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