Development Levy
The Development Levy is a 4% charge on the assessable profits of certain Nigerian companies, introduced to fund national development. Small companies that qualify for the 0% CIT rate are generally exempt from it.
Worked example
A company with ₦200,000,000 assessable profit pays 30% CIT (₦60,000,000) plus a 4% Development Levy of ₦8,000,000.
Who is exempt
Companies qualifying as small (turnover of ₦50 million or less and fixed assets of ₦250 million or less) are generally outside the levy, in line with their 0% CIT treatment.
Why it matters for planning
The levy is charged on assessable profits, not turnover, and it sits on top of CIT rather than replacing part of it. When modelling the total tax cost of growing past the small-company thresholds, count both.
More Nigerian tax terms
- Company Income Tax (CIT)
- Consolidated Relief Allowance (CRA)
- Direct assessment
- FIRS (Federal Inland Revenue Service)
- Input VAT
- Minimum wage tax exemption
- Output VAT
- PAYE (Pay-As-You-Earn)
- Personal Income Tax (PIT)
- Rent relief
- Tax Clearance Certificate (TCC)
- Tax Identification Number (TIN)
- Value Added Tax (VAT)
- Withholding Tax (WHT)
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