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FAQs On Payroll Taxes and Employer Liability: Closing the Compliance Gap Under Nigeria's New Tax Regime

Nigeria's tax architecture has changed but some employer payroll systems have not caught up. The Nigeria Tax Act 2025 and the Nigeria Tax Administration Act 2025 took effect on 1 January 2026 and redefined significant aspects of how PAYE operates; from a new six-band tax structure, to changes affecting gratuity, NHF deductions, severance benefits, and others. If your payroll system has not been updated to reflect these changes, every pay slip generated since 1 January 2026 has been based on outdated systems, exposing your organization to compliance risk and penalties. This article examines what employers need to do to bridge the gap in light of the new tax law regime.