By Uche Amunike
Nigerians on low income, small businesses as well as average taxpayers are to benefit from a wide range of tax waivers under the new tax reform laws from January 1, 2026.
This disclosure was made by the Chairman, Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, Monday, when he released a list of 50 specific tax exemptions and relief categories.
The list is as below:
Personal Income Tax/ PAYE – who will not pay income tax: These are waivers for people with low salaries or, on the national minimum wage.
1. People earning minimum wage or less — exempt
2. People earning up to ₦1.2m per year — exempt
3. People earning up to ₦20m per year get tax relief
4. Gifts you receive are not taxed.
Deductions That Reduce Your Tax – Money Government Allows You To Subtract Before Calculating PAYE: These are the expenses that the government will accept so that taxable incomes will become lower.
5. Pension contribution
6. NHIS health contributions
7. National Housing Fund contributions
8. Interests paid on home ownership loan
9. Money paid into life insurance / annuity
10. Rent relief up to ₦500,000 (20% of rent)
Pension and retirement money not taxed: These apply to people receiving end-of-service payments and retirees.
11. Pension funds and assets
12. Pension, gratuity and retirement benefits
13. Compensation for losing your job up to ₦50m
Capital Gains Tax (CGT)- When You Sell Property Or Assets, Government will not tax some specific kinds of sales.
14. Sale of your personal home
15. Personal items up to ₦5m
16. Sale of up to two private cars yearly
17. Gains on small share transactions under ₦150m / ₦10m
18. Tax is waived if you reinvest the share gains
19. Pension funds, charities, religious orgs (if non-commercial)
Companies Income Tax – Small Businesses Protected: This is where government lowers or removes tax so as to encourage job creation and growth.
20. Small companies with ≤ ₦100m turnover — no CIT
21. Labelled startups — exempt
22. Employers who raise salaries for low-income workers get extra deduction
23. Employers who hire and retain new workers for 3 years get deduction
24. Agric companies get 5-year tax holiday
25. Venture investors in labelled startups — exempt
Development levy – not for small companies.
26. Small businesses do not pay this levy.
Withholding tax reduced burden for small firms. It is removed to improve cash flow.
27. Small companies, manufacturers, agric — exempt on income
28. Small companies also exempt on payments made to suppliers
VAT – Zero VAT On Basic Needs. Government keeps essential goods exempt or Zero-rated.
29. Basic food items — VAT-free
30. House rent — VAT-free
31. Education — zero VAT
32. Health services — exempt
33. Pharmaceuticals — zero VAT
34. Small companies ≤ ₦100m turnover do not charge VAT
35. Diesel, petrol, solar equipment — VAT waived
36. You can claim VAT refund on capital items for production
37. Agric inputs — fertiliser, seeds, feeds, live animals — exempt
38. Agric equipment hire — exempt
39. Disability aids e.g. wheelchairs — exempt
40. Bus transport (shared public road transport) — exempt
41. Electric vehicles & parts — exempt
42. Humanitarian relief items — exempt
43. Baby products — exempt
44. Sanitary pads & tampons — exempt
45. Buying/selling land & buildings — VAT-free
Stamp duty charges removed on small transfers. This is where the government removes stamp duty on small transfers and some financial documents.
46. Electronic transfers below ₦10,000 — exempt
47. Salary payments — exempt
48. Transfers within the same bank — exempt
49. Transfer of government securities / shares — exempt
50. Documents for transfer of shares — exempt
These waivers and reliefs part of the 2024 to 2026 fiscal road map are designed to take effect from January 1, 2026.
