Payroll Calculator

Calculate total employer payroll cost including mandatory pension (10%) and NSITF (1%) contributions for your Nigerian workforce.

Workforce Details

Number of Employees

Average Gross Salary

₦

Total Monthly Payroll Cost

₦2,775,000

Total Cost per Employee

₦277,500

Gross Salary per Employee

₦250,000

Employer Pension (10%)

₦25,000

NSITF (1%)

₦2,500

Annual Payroll Cost

₦33,300,000

NHF (2.5% of basic salary) is deducted from the employee's pay, not an additional employer cost. PAYE tax is also deducted from employees — use our PAYE Calculator for individual tax computations.

Extended

Cost Per Employee Breakdown & Scaling

Visual breakdown of employer cost components and total cost at different team sizes

Monthly employer cost components per employee at ₦250,000 gross salary

Gross Salary

₦250,000

90.1% of total

Employer Pension

₦25,000

9.0% of total

NSITF

₦2,500

0.9% of total

Professional

Multi-Grade Payroll Summary

Add employees by grade/band, compute total payroll, PAYE, pension, NSITF, and ITF obligations

Count

Monthly Gross Salary (₦)

₦

Cost/emp: ₦1,665,000Total monthly: ₦3,330,000PAYE/emp: ₦171,863

Count

Monthly Gross Salary (₦)

₦

Cost/emp: ₦555,000Total monthly: ₦2,775,000PAYE/emp: ₦43,175

Count

Monthly Gross Salary (₦)

₦

Cost/emp: ₦222,000Total monthly: ₦3,330,000PAYE/emp: ₦8,725

Count

Monthly Gross Salary (₦)

₦

Cost/emp: ₦111,000Total monthly: ₦888,000PAYE/emp: ₦0

Payroll Summary

Total Employees

Monthly Payroll Cost

₦10,323,000

Annual Payroll Cost

₦123,876,000

Monthly PAYE (staff)

₦690,475

Monthly Pension (emp)

₦930,000

Monthly NSITF

₦93,000

How to Use This Calculator

Enter the number of employees and their average gross monthly salary. The calculator shows total payroll cost per employee (including mandatory employer contributions) and total monthly cost for your entire workforce.

For businesses with multiple salary bands, run the calculator separately for each group and sum the results.

Nigerian Employer Payroll Obligations

Employer Pension Contribution = Gross Salary × 10% NSITF (Workers' Compensation) = Gross Salary × 1% Total Employer Cost per Staff = Gross Salary + Pension(10%) + NSITF(1%) = Gross Salary × 111% NHF (2.5% of basic salary) is deducted from employee pay — not an additional employer cost, but must be remitted to FMBN. PAYE tax is also deducted from employee gross salary.

Example

Tech Startup with 10 Employees — Average Salary ₦250,000/month

Gross Salary (per employee)₦250,000

Employer Pension (10%)₦25,000

NSITF (1%)₦2,500

Total Cost per Employee₦277,500

Total Monthly (10 staff)₦2,775,000

Annual Payroll Cost₦33,300,000

At ₦250,000 average gross salary, each employee actually costs ₦277,500/month — 11% more than the salary figure. Factor this into your business budget and cash flow projections.

FAQ

Nigerian employers must contribute: (1) Pension — 10% of employee gross emolument (basic + housing + transport) per the Pension Reform Act 2014. (2) NSITF — 1% of total monthly payroll to the Nigeria Social Insurance Trust Fund for workers' compensation. (3) ITF — 1% of annual payroll (if 25+ employees or 5+ with ₦50M+ turnover). Additionally, employers must deduct and remit PAYE tax and NHF (2.5% of basic) from employees.

The Contributory Pension Scheme (CPS) applies to all employers with 3 or more employees in Nigeria. Both employer (minimum 10%) and employee (minimum 8%) must contribute. Employers must enroll staff within 3 months of resumption and remit contributions within 7 working days after salary payment. Non-compliance attracts penalties of up to 2% per month on outstanding contributions plus possible prosecution by PENCOM.

No — PAYE is deducted from the employee's gross salary (not an additional employer cost) and varies significantly based on individual salary, allowance structure, and reliefs. Use our PAYE Tax Calculator to compute exact tax for each employee. The total employer cost shown here is purely the employer's out-of-pocket expenditure above gross salary.

Payroll Calculator

Cost Per Employee Breakdown & Scaling

Multi-Grade Payroll Summary

How to Use This Calculator

Nigerian Employer Payroll Obligations

Example

Tech Startup with 10 Employees — Average Salary ₦250,000/month

FAQ

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