The Nigeria Tax Act 2025: What Every Freelancer Must Know

The Tax Law Has Changed

On June 26, 2025, President Bola Ahmed Tinubu signed four comprehensive Tax Reform Acts into law^[1]. These changes took effect on January 1, 2026 — which means they apply to you right now.

The four acts are:

If you're a freelancer, content creator, or remote worker earning from international platforms, this is the most significant tax change in Nigeria's history^[2].

What's New?

1. Foreign Income is Now Explicitly Taxable

Before 2025, there was ambiguity about whether income from Upwork, Fiverr, YouTube AdSense, or direct foreign clients was taxable. That ambiguity is gone.

The new law is clear: All income earned by Nigerian residents, regardless of where it comes from, is taxable^[3].

This includes:

2. The First ₦800,000 is Tax-Free

Here's the good news. Under the new NTA 2025, the first ₦800,000 of your annual chargeable income is taxed at 0%^[4].

What this means: If you earn less than ₦800,000 per year (~$500 USD at current rates), you owe nothing in personal income tax.

This is a major shift from the old system where everyone paid something from the first naira. The new law provides significant relief to low- and lower-middle-income earners^[5].

3. New Progressive Tax Brackets

For income above ₦800,000, here are the new tax brackets under NTA 2025^[6]:

Annual Chargeable IncomeTax Rate

First ₦800,0000%
₦800,001 – ₦3,000,00015%
₦3,000,001 – ₦12,000,00018%
₦12,000,001 – ₦25,000,00021%
₦25,000,001 – ₦50,000,00023%
Above ₦50,000,00025%

Important: These rates apply to chargeable income — your gross income minus allowable deductions and reliefs.

4. CRA is Abolished — Rent Relief Replaces It

Under the old law, the Consolidated Relief Allowance (CRA) reduced your taxable income by 21%+ automatically. The NTA 2025 abolishes CRA^[7].

It's replaced by a new Rent Relief:

If you're a homeowner or don't pay rent, you don't get this relief. Your only automatic relief is the 0% rate on the first ₦800,000^[8].

5. You Must Self-Assess and File

Unlike employees whose employers withhold taxes, freelancers must:

The deadline for 2026 income is March 31, 2027.

What You Need to Do

Step 1: Get Your Tax ID

If you don't have a Tax ID, you need one. Register at:

Step 2: Track Your Income

You need records of all income received. This includes:

Step 3: Identify Your Deductions

You can reduce your taxable income with legitimate business expenses^[10]:

Step 4: Calculate Your Tax

This is where it gets complicated. You need to:

Or... you could use TaxJeje to do this automatically.

Step 5: File on TaxProMax

The government's filing portal is TaxProMax: taxpromax.firs.gov.ng^[11]

You'll need your TIN and income records to file.

The Penalties for Not Filing

Don't ignore this. The penalties under the new NTAA are significant^[12]:

ViolationPenalty

Not registering for TIN₦50,000 + ₦25,000/month
Not filing returns₦100,000 first month + ₦50,000/subsequent month
False declarationUp to ₦1,000,000 or imprisonment

Directors and officers can also be held personally liable for corporate tax offenses.

The Bottom Line

The Nigeria Tax Act 2025 is not optional. If you're earning money as a freelancer or remote worker, you need to file by March 31, 2027 (for 2026 income).

The good news: With the new 0% bracket on the first ₦800,000 and proper deductions, most middle-income freelancers will actually pay less than under the old system^[13].

Need help calculating your tax? TaxJeje was built exactly for this — using the actual NTA 2025 rules. Track your income, identify deductions, and get a clear picture of what you owe.

Start Free with TaxJeje →

References