The Nigeria Revenue Service has reaffirmed that low-income earners and individuals receiving the national minimum wage or less remain entirely exempt from personal income tax under current tax legislation.
In an official public advisory released on Thursday, October 22, 2026, the national tax authority clarified that individuals earning an annual taxable income of ₦800,000 or less—translating to gross annual earnings of up to ₦1,200,000—are subject to a zero percent tax rate.
The clarification aims to address misleading information circulating regarding personal income tax obligations for low- and middle-income workers across the country.
Under the progressive tax schedule administered by the NRS, tax rates scale gradually from zero to 25 percent based on income brackets. Earnings within the initial ₦800,000 threshold incur zero personal income tax, while subsequent income bands are taxed at progressive rates of 15 percent, 18 percent, 21 percent, 23 percent, and a top rate of 25 percent applicable exclusively to taxable income exceeding ₦50 million annually.
The agency emphasized that higher rates apply only to portions of income falling within specific thresholds rather than taxing an individual’s entire gross income at the top marginal rate.
Addressing misconceptions regarding collection procedures, the NRS assured taxpayers that government authorities do not execute automatic or unapproved direct withdrawals from individual bank accounts. Taxpayers remain responsible for self-reporting annual earnings and filing returns while utilizing allowable statutory reliefs, including contributions to pension schemes, the National Health Insurance Scheme, the National Housing Fund, life insurance premiums, and rent relief.
”Individuals earning the national minimum wage or an annual taxable income of ₦800,000 or less pay zero personal income tax under the law,” the NRS noted in its guidance.
“The new tax framework is designed to protect low-income earners from financial pressure, expand statutory deductions for middle-income workers, and ensure that tax liabilities reflect actual earning capacity through a fair and transparent system”, NRS reaffirmed.
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