Development Levy
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Calculate the 4% Development Levy under the NTA 2025. This replaces the former TET (2.5%), ITDL (1%), NASENI, and PTF levies with a single consolidated charge.
Company Details
What Is the Development Levy?
The 4% Development Levy is a consolidated charge introduced by the NTA 2025 that replaces four separate levies: Tertiary Education Tax (TET, 2.5%), Information Technology Development Levy (ITDL, 1%), NASENI Levy, and Police Trust Fund Levy. It is charged on assessable profits — that is, taxable profits before deducting capital allowances and losses brought forward.
Who Pays the Development Levy?
All standard companies (turnover above ₦100 million) are liable for the Development Levy. Small companies (turnover ≤ ₦100M and total assets ≤ ₦250M) are exempt. The classification is reassessed each tax year based on the company’s most recent financial statements. Professional services firms cannot qualify as small regardless of turnover.
How It Differs from the Old Levies
Under the old regime, TET (2.5%) was paid to the Tertiary Education Trust Fund, ITDL (1%) to NITDA, and the other levies to their respective agencies. Companies had to file separate returns for each. The NTA 2025 consolidates all four into a single 4% payment administered by the NRS, simplifying compliance. The combined effective rate is virtually unchanged (3.5% vs 4%), but the single filing saves significant administrative effort.
Development Levy: Before vs After NTA 2025
Frequently Asked Questions About the Development Levy
No. The Development Levy is not a deductible expense for CIT purposes. It is calculated on assessable profits (profits before capital allowances and losses brought forward) and paid as a separate obligation.
The Development Levy is due at the same time as your CIT return — within 6 months of your financial year-end for existing companies, or 18 months from incorporation for newly registered companies.
Yes. Company classification is reassessed each tax year based on the most recent financial statements. If your turnover drops below ₦100 million and total assets fall below ₦250 million, you are reclassified as small and exempt from the levy for that year.
Yes, if they have a taxable presence in Nigeria through a permanent establishment or Significant Economic Presence. The 4% levy applies to their Nigerian assessable profits.
From January 2026, TET and ITDL no longer exist as separate levies. All payments are consolidated into the single 4% Development Levy administered by the NRS. No refunds are given for prior TET/ITDL payments.
No. Under the NTA 2025, professional services firms (law firms, accounting firms, consulting firms, medical practices) cannot qualify as small companies regardless of their turnover or asset levels. They are always classified as standard.
Late payment attracts the standard penalty of 10% of the amount due plus interest at the CBN Monetary Policy Rate (currently 27.50%) calculated daily from the due date until payment is made.
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