If you want a smaller tax bill in 2026, the smartest time to act is now, not when the deadline is staring you in the face. 

A few simple moves before the year closes can lower what you owe, keep you compliant with FIRS and your State IRS, and save you the stress and penalties that come with last-minute scrambling. 

These 5 things will reduce your 2026 Tax Bill:

1) Organise your records and get fully compliant, early

Tax savings start with clean records. Separate your business and personal money with a dedicated business account. Keep invoices, receipts, bank statements, and simple monthly summaries of income and expenses.

If you pay staff, make sure PAYE is deducted and remitted on time, and that pension and NHF contributions are up to date.

Register for a TIN if you have not, confirm your details on TaxPro Max, and reconcile any past notices so you are not paying penalties you could have avoided. When your numbers are neat, your returns are accurate, and you only pay what you truly owe.

2) Maximise the reliefs you are already entitled to

Most Nigerians leave money on the table by ignoring allowable reliefs. For individuals, the Consolidated Relief Allowance plus statutory deductions like pension contributions, National Housing Fund, and life assurance premiums reduce your taxable income.

If you run a registered charity or you donate to an approved fund, those donations may be allowable within the rules. Salary earners should check that HR has captured pension and NHF correctly on their payroll.

Self-employed people can set up their own pension and life cover so the contributions work for them at tax time. The key is evidence, keep the payment slips and policy documents.

3) Pick the structure and incentives that fit your business size

Company income tax in Nigeria is tiered. Small companies with turnover below a set threshold are exempt from CIT, medium-sized firms pay a lower rate, and large companies pay the standard rate.

If your business is still operating as an unregistered hustle, formally registering and keeping proper books could shift you into a more favourable band and unlock access to finance.

Certain sectors and exports may also qualify for incentives. If you are planning a big expansion or a new product line, get advice now so you can apply early rather than miss a whole basis period.

4) Treat VAT and WHT like cash you cannot spend

Nothing ruins profit faster than mixing tax with working capital. If you charge VAT, park it aside the moment you collect it and file on time.

Claim input VAT only where the law allows and keep supplier invoices to prove it. If your customers deduct withholding tax from your invoices, collect the credit notes and file them, those credits reduce your company’s income tax later.

If you are the one deducting withholding tax on contractors, rent, or services, remit promptly so you do not face penalties or lose supply relationships.

5) Time your spending to capture capital allowances and genuine deductions

Before the year ends, review your asset needs. Buying essential tools, machinery, computers, or delivery bikes you truly need, and putting them to use, can earn capital allowances that reduce taxable profit.

The same logic applies to necessary costs like staff training, software, and maintenance, which you have been postponing. Spend only on what helps the business and make sure it is documented, paid from the business account, and backed by receipts or contracts.

Avoid fake or inflated expenses that will be disallowed, they create tax risk without saving you a kobo.