Stop Leaving Money on the Table: A Guide to Valid Tax Deductions
12th February 2026
Thousands of Nigerians overpay their taxes every single year because they don't know what they are allowed to deduct. From pension contributions to business expenses, the law offers legal reliefs to lower your bill. The government won't apply them for you—so here's how to claim them yourself.
Under Nigeria's Personal Income Tax Act (PITA), every taxpayer is entitled to a Consolidated Relief Allowance (CRA) of ₦200,000 or 1% of gross income — whichever is higher — plus 20% of gross income, completely tax-free. Beyond the CRA, contributions to a PENCOM-registered Pension Fund Administrator (PFA) are fully deductible, as are premiums paid on qualifying life assurance policies. If you contribute to the National Housing Fund (NHF) through the Federal Mortgage Bank of Nigeria, that too reduces your taxable income. Many Nigerians miss these reliefs entirely because their employers never apply them, or because they file without professional guidance.
For business owners and freelancers, the deductions go further. Verified business expenses — broadband subscriptions, professional association dues, travel costs directly tied to income generation, and even depreciation on business equipment — can all be claimed against your profit before tax is calculated. The key is documentation: every deduction must be backed by a receipt, invoice, or bank statement. The FIRS and State Internal Revenue Services have the right to audit any claim, so keeping clean records is not optional. Working with a tax professional ensures you claim every relief you're legally entitled to, without crossing the line into evasion.