How the Nigeria business income tax calculator is verified

Inputs

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

The formula

Each derived value below is computed by the Valem engine from the expression shown, in this order. Nothing else runs — there is no hidden code path.

Derived value	Field	Formula (JSONata)
Assessable profit	`assessableProfit`	`$round($max([0, $n(annualTurnover) - $n(annualExpenses)]), 2)`
National Housing Fund 2.5%	`nhfAnnual`	`nhfMember ? $round(assessableProfit * $const.nhfRate, 2) : 0`
Rent relief	`rentRelief`	`$round($min([$n(annualRent) * $const.rentReliefRate, $const.rentReliefCap]), 2)`
Chargeable income	`chargeableIncome`	`$round($max([0, assessableProfit - $n(pensionContributions) - nhfAnnual - rentRelief]), 2)`
Income tax	`incomeTax`	`$round($bandedCharge(chargeableIncome, [{"upTo": $const.band1, "rate": $const.rate0}, {"upTo": $const.band2, "rate": $const.rate1}, {"upTo": $const.band3, "rate": $const.rate2}, {"upTo": $const.band4, "rate": $const.rate3}, {"upTo": $const.band5, "rate": $const.rate4}, {"upTo": null, "rate": $const.rate5}]), 2)`
Income after tax	`netIncome`	`$round($max([0, assessableProfit - incomeTax - nhfAnnual - $n(pensionContributions)]), 2)`

Rates and thresholds

The expressions above read these as $const. They are the figures the annual refresh replaces, so they live as data rather than being written into the formulas — which is what makes a year-on-year change a one-line diff instead of an edit to arithmetic.

Constant	Value
`band1`	800000
`band2`	3000000
`band3`	12000000
`band4`	25000000
`band5`	50000000
`rate0`	0
`rate1`	0.15
`rate2`	0.18
`rate3`	0.21
`rate4`	0.23
`rate5`	0.25
`rentReliefRate`	0.2
`rentReliefCap`	500000
`nhfRate`	0.025

Test vectors (5)

Every case is executed against this model on each build, by the Java engine and independently by a JavaScript one. A mismatch of a single cent fails the build, so the page cannot ship advertising a figure the model no longer produces.

Case 1 — S1 ₦8,000,000 of profit, ₦1.5m rent, NHF: ₦7,500,000 chargeable, tax ₦330,000 + 18% of ₦4,500,000

given `annualTurnover`	12000000
given `annualExpenses`	4000000
given `annualRent`	1500000
given `pensionContributions`	0
given `nhfMember`	yes
expect `assessableProfit`	8000000
expect `chargeableIncome`	7500000
expect `incomeTax`	1140000
expect `netIncome`	6660000

Case 2 — S1b the same profit: NHF ₦200,000 and rent relief ₦300,000

given `annualTurnover`	12000000
given `annualExpenses`	4000000
given `annualRent`	1500000
given `pensionContributions`	0
given `nhfMember`	yes
expect `nhfAnnual`	200000
expect `rentRelief`	300000

Case 3 — S2 ₦800,000 of profit, no NHF or rent: nothing to pay

given `annualTurnover`	1000000
given `annualExpenses`	200000
given `annualRent`	0
given `pensionContributions`	0
given `nhfMember`	no
expect `chargeableIncome`	800000
expect `incomeTax`	0
expect `netIncome`	800000

Case 4 — S3 ₦60,000,000 of profit with ₦2m pension: ₦10,430,000 + 25% of ₦6,000,000

given `annualTurnover`	80000000
given `annualExpenses`	20000000
given `annualRent`	0
given `pensionContributions`	2000000
given `nhfMember`	no
expect `chargeableIncome`	58000000
expect `incomeTax`	12430000

Case 5 — S4 ₦12,000,000 chargeable: ₦1,950,000 at the top of the 18% band

given `annualTurnover`	12000000
given `annualExpenses`	0
given `annualRent`	0
given `pensionContributions`	0
given `nhfMember`	no
expect `incomeTax`	1950000

Sources

Nigeria Tax Act 2025 (Act No. 7, in force 1 Jan 2026), s.58 and Fourth Schedule · checked 2026-11-01
Nigeria Tax Act 2025 s.30(2)(a): eligible deductions, rent relief 20% up to ₦500,000 · 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 · checked 2026-11-01

Check it yourself — and reuse it

The whole model as JSON — inputs, outputs, formulas, vectors and sources in one re-runnable document.

This model is published under CC BY 4.0: use it, adapt it, build on it, with attribution. The licence covers the model — the expression of each rule and the arrangement of the catalog. The rates and thresholds are law, and nobody licenses those; the sources above are where they come from.

← Back to the Nigeria business income tax calculator

Built with Valem — a live, verifiable calculator you can fork and embed.