From January 2026, millions of Nigerians will legally keep more of their money.
A new wave of over 50 tax reliefs is set to reshape personal finance, business growth, and investment opportunities across the country. If you understand these changes early, you can build wealth quietly while others complain.
For years, Nigerians worked hard while taxes worked harder. Food, rent, business income—even savings—were taxed. But for the first time in decades, the government is saying: “Keep more of what you earn. Use it to grow.”
Here’s what’s changing and how you can benefit.
1. Major Reliefs for Individuals
Zero tax for low-income earners
Starting January 1, 2026:
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Anyone earning ₦100,000 or less monthly will pay zero tax.
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If your annual income is ₦1.2 million or below, you’re fully exempt.
Gifts are no longer taxed
Money or items received as personal gifts will no longer attract tax.
Rent relief to reduce living costs
You now get 20% off your annual rent (up to ₦500,000) as a tax deduction.
Deductions that reduce your tax bill
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Pension
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National Housing Fund (NHF)
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Life insurance premiums
All these reduce your taxable income even further.
2. What This Means in Real Life
Take Tomi, who earns ₦200,000 monthly.
Before 2026, she lost ₦16,000 monthly to tax—₦192,000 gone yearly.
From 2026, she keeps that ₦192,000.
If she invests it in a Money Market Fund at 15%, she earns:
₦220,800 in a year.
Her money now works for her—not “for the system.”
3. Good News for Employees
The new tax regime rewards employers who grow:
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Companies get tax deductions for raising salaries.
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Businesses earn deductions for hiring more staff.
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Job loss compensation up to ₦50 million is now tax-free.
This means more companies will be open to salary increases and fresh recruitment. It’s a strategy many nations use to attract growth—and now, it’s Nigeria’s turn.
4. A New Dawn for Small Businesses & Startups
Entrepreneurs, this is your era.
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Small companies (below ₦100m turnover): 0% tax
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Medium companies (₦100m–₦250m): reduced company tax
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Startups: full exemption
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Agribusiness: 5-year tax holiday
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50% tax deductions on staff salaries, transport, and training
From the tailor to the farmer to the tech founder—scaling is now easier and cheaper.
5. Investors Get Massive Relief Too
The new reforms make investing more attractive:
No Capital Gains Tax when you:
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Sell your self-occupied residential house
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Sell up to two personal cars yearly
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Earn stock profits under ₦150 million
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Reinvest your capital gains
Even pension funds, charities, and faith-based organisations enjoy full exemptions.
6. Families Will Feel the Difference
A long list of essentials is now VAT-free, including:
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Food
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Rent
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Education
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Health & drugs
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Baby products
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Transportation
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Disability aids
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Electric vehicles
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Agricultural inputs
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Sanitary pads
Cheaper living costs mean more disposable income—and more room to grow wealth.
7. Everyday Transactions Become Cheaper
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No stamp duty on bank transfers below ₦10,000
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No charges on salaries, intra-bank transfers, or stock transactions
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Humanitarian supplies and clean-energy equipment are tax-free
More money now stays in circulation where it matters—your pocket and the real economy.
8. How to Directly Benefit From These Reforms
To fully maximize the new tax era, take these practical steps:
1. Review your payslip
Ensure your pension, NHF, and life insurance deductions are active.
2. Register your business properly
Use CAC and SMEDAN so you legally qualify for 0% tax and other exemptions.
3. Keep clean financial records
Tools like Bumpa, Zoho, QuickBooks, and Sage can help.
4. Invest your tax savings monthly
Platforms like Cowrywise, Bamboo, CardinalStone, or Chaka offer good options.
5. Own assets that now enjoy tax exemptions
Such as:
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Land
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Shares
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Agribusiness ventures
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Personal residential property
Final Word: Growth Belongs to the Doers
Nigeria is opening the door to a friendlier, wealth-focused tax system.
But knowledge alone doesn’t grow wealth—action does.
The earlier you understand and apply these new tax reliefs, the faster you’ll build the financial future you desire.
Grab the gist? Now go and grow.
