Section 14 Nigeria Tax Act 2025

Section 14 of the Nigeria Tax Act 2025 is about Benefits-in-kind. It provides as follows:

(1) Where an employer incurs an expense in the provision of any benefit or perquisite, other than the provision of living accommodation to which this section relates, the following provisions shall apply –
(a) where any asset belonging to the employer is used wholly or partly in the making of such provisions, the employee is deemed to have earned annual benefit of an amount equal to 5% of the amount expended by the employer in acquiring the asset, but if that amount cannot be so ascertained, 5% of the market value of the asset at the time of the acquisition, as may be determined by the relevant tax authority;

(b) where any sum by way of rent or hire is payable by the employer in respect of any such asset, the employee is deemed to have earned annual benefit of an amount equal to the annual amount of the rent or hire payable by the employer on the asset; and

(c) in any other case, the employee is deemed to have earned annual benefits equal to the annual amount expended by the employer in connection with the benefit thereon.

(2) The amount of benefit under subsection (1)(a) shall be reduced by so much of any expense made by the employee in respect thereon.

(3) The provisions of this section shall not apply to any expenses incurred
by an employer –
(a) in connection with the provision of meals in any canteen in which meals are provided for the staff generally or meal vouchers for employees;

(b) in the provision of any uniform, overall or other protective clothing, work tools or work equipment; or
(c) in connection with change in place of residence of the employee by reason of a change of the employee’s employment or place of exercising the employment.

(4) A reference in this subsection to expenses incurred in connection with any matter includes a reference to a proportion of any expenses incurred partly in connection with that matter.

(5) A reference in this section to anything provided for an employee shall, unless the reference is expressly to something provided for the employee, be construed as including a reference to anything provided for the spouse, family, servant, dependant or guest of that employee by the employer.

(6) Where premises in Nigeria are made available by an employer to the employee, the spouse or family, and the employee –
(a) pays no rent for the premises , or
(b) pays a rent less than the annual rental value of the premises, the employee shall be treated as being in receipt of additional emoluments equal to the annual rental value of the premises, subject to a maximum of 20% of annual gross income from the employment, excluding the rental value.

(7) In this section, “annual value of the premises” means –
(a) in relation to premises that are subject to a law governing assessment of local rates, the annual rental value of the premises as determined for the purposes of local rates under that law;
(b) in any other case, the annual rental value as determined by the relevant tax authority; and

(c) a reference in this section to annual value shall include a reference, where applicable, to such proper proportion of the annual value in relation to –
(i) a period of occupation within a year,
(ii) the part of the premises occupied, or
(iii) both a period of occupation within a year and the part of the premises occupied, as may be determined by the relevant tax authority.

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