How new tax reforms affect your monthly alert if you're earning between ₦100,000-₦500,000

You know that moment when your salary drops, and before you shout, “God, when?”, you see deductions that feel like someone’s dragging your account with juju? Well, it’s not jazz o, it’s the new tax laws doing gbas gbos on your payslip, lol!

Say hello to the Nigeria Tax Act, 2025, and its cousin, the Nigeria Tax Administration Act, 2025, the new legislation regulating how your money gets chopped… legally.

If you earn between ₦100,000 and ₦500,000, these laws have entered the group chat to decide how much stays with you and how much goes to the tax gods (a.k.a. the government).

So, before you call your HR for “why is my alert slim?”, let’s break it down for you.

Your Income is Still Taxable (No Matter the Wahala)

So, you finally landed that 9–5 in Lekki, or maybe you’re working remotely from your parents’ house in Ibadan, congrats! But here's the tea: your income is still taxable. Yup, even in this economy.

Under the Nigeria Tax Act, 2025, the government says all types of income, including what you earn from your job, are taxable.

Whether you’re a bank staff, tech bro/sis, sales rep, or even a customer care agent grinding for that ₦150k–₦400k monthly pay, the money you make is not entirely yours.

The law basically says, “We see that alert, and we want our share.”

They calculate your tax from your total income after removing allowable deductions (we’ll get to that later). Yes, employment income is considered taxable income.

Don’t let the "I work from home, na contract job" mindset deceive you, if you earn, you pay.

PAYE Still Dey: Your Tax Is Still Deducted Monthly

If you’ve ever looked at your salary slip and seen amounts deducted under “PAYE” and wondered “Who is this PAYE sef?”, it stands for Pay As You Earn. And under the Nigeria Tax Administration Act, 2025, it's still alive and kicking.

That means your employer, whether it’s Access Bank, Flutterwave, a fintech startup, or even a logistics company, will keep deducting your tax directly before your salary drops in your account.

So, if you earn ₦250k monthly and only see ₦225k, that’s probably tax doing its thing.

This system helps keep things stress-free (well, sort of), so you don't have to queue at FIRS or start figuring out complex tax forms like it’s WAEC Maths.

Deductions and Exemptions: Small Ways to Save

Now, for some good news, some deductions and exemptions can reduce how much tax you pay.

The Nigeria Tax Act, 2025, allows things like:

Deductible donations (e.g., if you support registered NGOs or charity organisations, not your cousin’s GoFundMe for vibes).

Certain work-related expenses (though full details aren’t clear yet)

For instance, let’s say you earn ₦180k and regularly support an NGO that feeds kids in Makoko, that donation might help reduce your taxable income.

Companies Get 50% Extra Deduction for Helping Low-Income Workers

Here’s one that might benefit you, depending on your employer.

The law says companies can claim an extra 50% deduction if they give salary increases, wage awards, or even transport allowances to low-income workers (those earning ₦100k/month or less).

So if you’re working in a small firm that just boosted your pay from ₦85k to ₦100k and started giving you ₦5k for transport to survive the fuel price, just know the government is encouraging such moves.

In the same vein, the tax law talks about a “simplified annual tax return” for low-income earners. Basically, they’re trying to make things easier for folks earning small-small, especially now that jollof rice is almost ₦1,500 per plate.

What This Means for Your Pocket

Bottom line! Yes, your salary is still taxable, and monthly deductions are still a thing, but the new tax law is also trying to be fair, especially to those on the lower end of the income ladder.

The documents don’t list exact tax rates or how much you’ll pay if you earn, say, ₦350k/month, but they suggest that the government is thinking of ways to make compliance easier and offer incentives to employers who take care of their low-income staff.

So, if you’re hustling with that ₦100k–₦500k salary in today’s “sapa economy”, this law might not change your life overnight, but it’s something to keep an eye on, especially if you ever plan to negotiate better pay, donate to a cause, or simply want to understand why “₦25k tax” disappeared from your payslip.