Nigeria Withholding Tax (WHT) Calculator
Simplify Your Tax Compliance
Navigating Nigeria's tax landscape can be complex. Our intuitive WHT calculator helps businesses and individuals accurately compute their tax liabilities on various transactions, ensuring compliance with the latest Nigerian tax laws.
Nigerian Withholding Tax (WHT) Calculator
Why Use Our Nigeria WHT Calculator?
Accuracy & Compliance
Leverage up-to-date tax rates and regulations to ensure precise WHT calculations, minimizing errors and penalties.
Time-Saving
Instantly calculate WHT for various transactions, freeing up valuable time spent on manual computations.
Clarity & Understanding
Gain clear insights into how WHT is applied to your specific income streams or payments.
Informed Decision-Making
Plan your finances better with a clear understanding of your tax obligations.
What is Withholding Tax (WHT) in Nigeria?
Withholding Tax (WHT) is an advance payment of income tax, deducted at source from certain types of income or transactions. It is a crucial aspect of the Nigerian tax system, applied to payments for services, contracts, rent, dividends, interest, and more.
The applicable rates and the party responsible for deducting and remitting the tax vary depending on the nature of the transaction and the parties involved. The Nigeria Tax Act, 2025 specifies various ad valorem and fixed duties for numerous instruments, indicating different rates and liable parties for different transaction types.
For non-resident companies with a taxable presence in Nigeria, the tax payable cannot be less than the applicable WHT rate for the income, or 4% of the income.
How It Works
Select Transaction Type
Choose the category of income or payment (e.g., professional fees, rent, dividends, contracts)
Enter Amount
Input the gross amount of the transaction in Naira
Calculate
Our tool instantly applies the relevant WHT rate to provide results
Understand Your Obligation
See the WHT amount, net payment, and who is responsible for deduction
Key Features
Withholding Tax Rates in Nigeria
| Transaction Type | Company Rate | Individual Rate |
|---|---|---|
| Dividends, Interest, Royalties | 10% | 10% |
| Rent (Property) | 10% | 10% |
| Professional Fees, Consultancy, Management Fees | 10% | 5% |
| Director's Fees, Commission | 10% | 10% |
| Construction / Building Contracts | 5% | 5% |
| Contract of Supply (Goods) | 5% | 5% |
| Agency Arrangements | 10% | 10% |
* Non-resident rates may differ. Double Taxation Agreements (DTAs) may provide reduced rates for qualifying recipients.
Who Can Benefit?
Businesses
Small, medium, and large enterprises making payments subject to WHT can ensure accurate deductions and timely remittance.
Individuals
Self-employed professionals, landlords, and others receiving income subject to WHT can understand their net receipts.
Accountants & Tax Practitioners
A handy tool for quick verification and client advisories on WHT obligations.
Non-Resident Companies
Determine minimum tax obligations where WHT rates apply to Nigerian-sourced income.
Key Facts About Nigerian WHT
WHT Exemptions and Special Cases
- -Government entities making payments to other government entities
- -Dividends paid out of petroleum profits (subject to Petroleum Profits Tax)
- -Interest on government bonds and treasury bills
- -Goods purchased by companies in the ordinary course of business (with exceptions)
- -Payments to tax-exempt organizations (with valid exemption certificates)
Other Tax Calculators
Important Disclaimer:
This calculator uses standard Nigerian WHT rates as per current tax laws including the Nigeria Tax Act, 2025. Actual rates may vary based on recipient status (individual vs. company, resident vs. non-resident), Double Taxation Agreements (DTAs), specific exemptions, and transaction thresholds. Rates can vary based on specific contract terms and ongoing changes in tax law (e.g., Finance Acts). Always consult the latest FIRS circulars or a qualified tax professional for accurate WHT obligations.
Frequently Asked Questions
What is the withholding tax rate table in Nigeria?
Key WHT rates under the Nigeria Tax Act, 2025: Dividends — 10%; Rent (property) — 10%; Interest — 10%; Royalties — 10% (companies), 5% (individuals); Directors' fees and commission — 10%; Professional, management and consultancy fees — 5% (companies), 5% (individuals); Construction and building contracts — 2.5% (companies), 5% (individuals); Agency arrangements — 10%; Supply of goods (above ₦2 million threshold) — 2% (companies). Reduced rates may apply under Double Taxation Agreements (DTAs) between Nigeria and countries such as the UK, France, China, and South Africa.
Who pays withholding tax in Nigeria — the payer or the recipient?
The payer (the party making the payment) is responsible for deducting and remitting withholding tax. The recipient receives the payment net of WHT. For example, if a company pays professional fees of ₦1,000,000 to a consulting firm, it deducts WHT at 5% (₦50,000) and remits that to FIRS — the consultant receives ₦950,000. The consultant receives a WHT credit note for ₦50,000, which offsets their final income tax or company income tax assessment for the year.
What is the withholding tax rate on rent in Nigeria?
The WHT rate on rent (property rental income) in Nigeria is 10% for both companies and individuals under the Nigeria Tax Act, 2025. Example: if a company pays annual rent of ₦2,400,000, it deducts WHT of ₦240,000 (10%) and remits it to FIRS, paying the landlord ₦2,160,000. The landlord receives a WHT credit note for ₦240,000 to offset against their annual tax assessment. WHT on rent must be remitted within 30 days of the end of the month the deduction was made.
What is Withholding Tax (WHT) in Nigeria?
Withholding Tax (WHT) in Nigeria is an advance payment of income tax deducted at source by the payer when making certain payments to a recipient. It is not a separate tax — it is a credit against the recipient's final income tax or company income tax liability. WHT is deducted by the paying party (the withholder) and remitted to FIRS or the relevant State Internal Revenue Service within 30 days of the end of the month the deduction was made.
When should WHT be deducted and remitted in Nigeria?
WHT must be deducted at the time of payment or at the time the amount is credited to the payee's account — whichever occurs first. So if you post a journal entry crediting a supplier before actually paying them, the WHT obligation arises at that credit date. Deducted WHT must then be remitted to FIRS (or the relevant SIRS for individuals) within 30 days of the end of that month, along with a WHT credit note issued to the recipient.
Which transactions are exempt from WHT in Nigeria?
Transactions generally exempt from WHT include: purchases of goods below the ₦2 million threshold; salaries and wages (which attract PAYE instead); transactions with MDAs (Ministries, Departments and Agencies) acting as suppliers; dividends paid to REITs; dividends paid out of petroleum profits (subject to PPT); interest on government bonds and treasury bills; and income exempt under specific investment incentive legislation.
What are the penalties for failure to deduct or remit WHT in Nigeria?
A company that fails to deduct WHT becomes liable for the undeducted tax plus a penalty of 10% of that amount and interest at the CBN minimum rediscount rate, per the Nigeria Tax Administration Act, 2025. Late remittance of deducted WHT attracts the same 10% penalty plus interest. The withholder also cannot claim the payment as a deductible expense if WHT was not properly withheld.