How to Declare Multiple Streams of Income for Tax in 2026

For many Nigerian professionals balancing a 9-to-5 and one or more side hustles, the new tax regime is a mix of relief and responsibility.

With the Nigeria Tax Act (NTA) 2025 now in force and the system shifting toward more digital reporting, the key question is straightforward: how do you declare all your income legally,without paying tax twice?

The short answer is consolidation. In the eyes of the law, you are one taxpayer, even if your income comes from multiple sources. Your salary and side income are assessed together, then any tax already deducted (like PAYE) is credited against what you owe.

1) Start with income consolidation, not separation

PAYE deductions from your employer do not automatically “cover” other income streams. What typically happens is:

Your employer remits PAYE monthly on your employment income, and you still file an annual return of income from all sources (employment plus side income).

When you file, you compute your total annual tax based on your consolidated income, then subtract PAYE already remitted. 

2) Understand the 2026 PIT bands (the first ₦800,000 is tax-free)

Under the reforms, annual income up to ₦800,000 is exempt. Above that threshold, the rates apply progressively in layers (not one flat rate on the entire amount).

Here are the bands commonly summarised from the NTA:

• First ₦800,000: 0%
  
• Next ₦2,200,000: 15%
  
• Next ₦9,000,000: 18%
  
• Next ₦13,000,000: 21%
  
• Next ₦25,000,000: 23%
  
• Above ₦50,000,000: 25%
  

3) Avoid “over-taxation” by declaring profit, not gross inflow

A common mistake with side hustles is treating all money that enters your account as taxable “income.” For business/freelance income, tax is generally assessed on profit,what remains after allowable business expenses,rather than total inflows. (Exact deductibility depends on documentation and the relevant tax authority’s rules.)

In practice, that means you should keep clean records of legitimate work costs such as tools/software, data/internet, power costs attributable to work, logistics, and other direct business expenses,so you can support your profit calculation if queried.

4) Use the new Rent Relief to reduce taxable income

The reforms introduced a Rent Relief that allows eligible taxpayers to claim 20% of annual rent paid, capped at ₦500,000 (whichever is lower), provided the rent is accurately declared and supported.

If you qualify and can evidence rent paid, this is one of the most practical reliefs to apply in a multi-income situation.

5) Keep side hustle funds separate

Tax compliance becomes harder when you mix everything into one salary account. If side venture proceeds are paid into the same account as wages, it becomes difficult to distinguish business income from non-taxable inflows like reimbursements or gifts.

This matters more under the new reporting environment: the tax reform framework includes bank reporting requirements tied to high-value turnover/inflows (commonly referenced as ₦25 million thresholds for individuals in certain reporting contexts).

Maintaining a dedicated business account helps you prove what is turnover, what is cost, and what is profit.

6) File on time and align with your State Internal Revenue Service

Employers’ annual PAYE returns are commonly referenced with a January 31 deadline (for example, Lagos has reiterated January 31, 2026 for 2025 filings).

Individuals in paid employment are also required to file an annual return covering income from all sources, notwithstanding the employer’s filing.

Because filing mechanics and deadlines can be shaped by state notices and implementation guidance, confirm the exact window on your SIRS portal or via official circulars,especially as experts have noted that clearer timelines for individual filings under the new administration framework are still an area of attention.