# Self-employed tax calculator Nigeria 2026 — sole proprietors

Source page: https://valem.run/calculators/nigeria/self-employed

A self-employed individual in Nigeria pays personal income tax on business profit at the same rates as employees — nothing on the first ₦800,000 of chargeable income, then 15% rising to 25% above ₦50 million — after deducting rent relief, pension contributions and the 2.5% National Housing Fund share.

**Tax year:** 2026

## How it is calculated

Under the **Nigeria Tax Act 2025**, in force from 1 January 2026, an individual’s total income includes the assessable profit of a trade, business, profession or vocation, after capital allowances (s.28). Section 30 deducts the same eligible items as for an employee — pension contributions under the Pension Reform Act, National Housing Fund contributions and **rent relief** of 20% of rent up to **₦500,000** — and section 58 applies the Fourth Schedule: **0%** to ₦800,000, then **15%**, **18%**, **21%**, **23%** and **25%** above ₦50 million.

On **₦8 million of profit** with ₦1.5 million of rent, NHF is 2.5% (₦200,000) and rent relief ₦300,000, leaving ₦7.5 million chargeable. Tax is ₦330,000 + 18% of ₦4.5 million = **₦1,140,000**, so ₦6,660,000 is left after tax and NHF.

The National Housing Fund Act requires self-employed people to pay 2.5% of their income (s.10; its s.4, replaced by the Business Facilitation Act 2022, is reported to keep this compulsory); the page applies it to profit and lets you switch it off. The 0% rate for a **small company** (turnover up to ₦100 million and total fixed assets not exceeding ₦250 million) is for companies, not for someone trading in their own name. Losses, life-assurance premiums, mortgage interest, withholding tax credits and presumptive assessments are not modelled. Estimate, not tax advice.

## Worked example

With Business or professional income for the year of 12,000,000, this model computes Income after tax of 6,660,000 NGN.

## Inputs

| Name | Label | Type |
| --- | --- | --- |
| `annualTurnover` | Business or professional income for the year (₦) | number |
| `annualExpenses` | Deductible expenses and capital allowances (₦) | number |
| `annualRent` | Rent you pay for your home (₦ / year) | number |
| `pensionContributions` | Your pension contributions under the Pension Reform Act (₦ / year) | number |
| `nhfMember` | Contributing 2.5% of income to the National Housing Fund | boolean |

## Sources

- [Nigeria Tax Act 2025 (Act No. 7, in force 1 Jan 2026), s.58 and Fourth Schedule](https://nass.gov.ng/documents/download/11249) (checked 2026-11-01)
- [Nigeria Tax Act 2025 s.30(2)(a): eligible deductions, rent relief 20% up to ₦500,000](https://nass.gov.ng/documents/download/11249) (checked 2026-11-01)
- [NHF Act Cap N45 (FMBN, 2004 text) ss.4, 10: self-employed 2.5% of income; s.4 replaced by the Business Facilitation Act 2022](https://fmbn.gov.ng/backend/storage/uploads/37UNgpzsyASabzhQCnHuyzFtIpnsfmW2ODvAmQSG.pdf) (checked 2026-11-01)

## What this page claims

The Valem engine reproduces this model's formula through 5 self-test cases. That shows internal consistency, not that the formula matches current law; the cited sources are the evidence for that. Estimate, not tax advice.

## For agents

- Model manifest (formula, constants, test vectors): https://valem.run/calculators/nigeria/self-employed.json
- Compute by URL: https://valem.run/calculators/nigeria/self-employed.json?annualTurnover=12000000
- MCP: https://valem.run/mcp/calculators (call `calculate` with calculator `nigeria/self-employed`)