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PAYE, pension, NHF, NSITF and ITF: what iPay works out on every payroll run

The five statutory deductions and contributions on a Nigerian payroll, what iPay calculates for each, and the part that is still yours to do.

iPay teamiPayPublished2 min readGuide
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Every Nigerian payroll carries the same five statutory lines. Getting each one right, for every employee, every month, is most of what makes payroll hard. This is how iPay handles them.

The five

Item What it is Who it comes from
PAYE Personal income tax, paid to the state where the employee is resident Deducted from the employee’s pay
Pension Contributory pension, paid to each employee’s Pension Fund Administrator Employee and employer both contribute
NHF National Housing Fund contribution Deducted from the employee’s pay
NSITF Employees’ compensation contribution Paid by the employer
ITF Industrial Training Fund contribution Paid by the employer

What iPay does on every run

Calculates. Each deduction is computed from your employees’ pay and details on every run, and shown line by line on the payslip, so staff can see exactly how their gross pay became their net pay.

Splits. Pension is split across each employee’s own PFA, and PAYE by the state tax authority it is due to, so a schedule is ready for each recipient rather than one lump sum.

Schedules. Each remittance is laid out against its deadline, so you can see what is due, to whom and by when before the month closes.

Records. Once you have paid, you record the remittance receipt in iPay against its schedule. The calculation, the schedule, the payment and the proof sit in one place.

The part that is yours

iPay does not move money to the tax authorities or PFAs for you. You make each remittance yourself, from your own account. What iPay removes is the spreadsheet work around it: the calculations, the per-recipient schedules, the deadlines and the paper trail.

We say this plainly because it matters for your controls. The payment stays with your finance team; the evidence stays in iPay.

Approvals before anything leaves

A run moves through your approval chain before any salary is paid. You set the levels, by team, payment type or amount, and every sign-off is recorded with who approved and when.

Where to go next

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