If you’re renting in Nigeria, the 2026 Tax Act now lets you deduct part of what you pay in rent from your taxable income — up to ₦500,000 a year. Here’s what the relief covers, who qualifies, and exactly how to claim it.
What is the rent relief under the Tax Act?
Since January 1, 2026, individual taxpayers who rent their home can deduct 20% of the rent they pay from their taxable income, capped at ₦500,000 per year. If 20% of your annual rent is less than ₦500,000, you deduct the actual 20% figure; if it’s higher, the deduction is capped at ₦500,000.
Who qualifies for the rent relief?
The relief applies to individual taxpayers who rent the home they live in and pay tax under Nigeria’s personal income tax system. It does not apply to rent paid for commercial or investment property, and it isn’t tied to a specific state — it’s a federal provision under the Tax Act.
How do you claim the rent relief?
Claiming the relief comes down to paperwork and a claim filed with your annual return:
- Signed tenancy agreement naming you as the tenant and stating the annual rent.
- Proof of payment — a receipt or bank transfer confirmation from your landlord.
- 20% calculation, capped at ₦500,000, entered as a deduction against your taxable income.
- Declaration through FIRS TaxPro-Max (or your employer’s PAYE filing, where applicable) alongside your supporting documents.
What mistakes should you avoid?
- No written agreement: a verbal arrangement with your landlord won’t be accepted as proof — insist on a signed tenancy agreement.
- No proof of payment: cash paid without a receipt is difficult to substantiate if your claim is queried.
- Forgetting the cap: even if 20% of your rent exceeds ₦500,000, that’s the maximum you can deduct.
Frequently asked questions
Does the rent relief apply to shared accommodation?
Yes, as long as your name is on the tenancy agreement and you can show the portion of rent you personally paid.
Can landlords claim this relief too?
No — the relief is designed for tenants. Landlords have separate provisions under the Tax Act for rental income.
Is the relief automatic?
No, you need to actively claim it when filing your return, with your tenancy agreement and payment proof as supporting documents.
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