Company Cars, Housing and Other Work Perks That May Be Taxable in Nigeria

Your monthly salary is not the only part of your compensation that may be taxed. Under Nigeria’s 2026 tax framework, benefits provided by an employer can be treated as taxable employment income in some cases. A benefit in kind is a non-cash benefit received because of your job. This may include a company car, accommodation or other employer-funded perks. Under Section 14 of the Nigeria Tax Act 2025, an asset provided for an employee’s use is generally valued at 5% of its acquisition cost each year. If the cost is unavailable, 5% of its market value at acquisition may apply. For example, a car bought for ₦20 million could create a taxable benefit value of ₦1 million yearly, less any amount contributed by the employee. Employer-provided accommodation may also count as additional income where it is rent-free or below its annual rental value. However, the taxable amount cannot exceed 20% of the employee’s annual gross employment income, excluding the rental value. Not every workplace perk is taxable: staff meals or meal vouchers, uniforms, protective clothing, work tools, equipment and some relocation expenses are excluded. Employees should check how non-cash benefits appear on their payslips and tax records. Employers should keep clear records of assets and benefits provided. The key question is not only how much cash enters your account, but also which employment benefits you receive and how the law values them.

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