The Business Facilitation (Miscellaneous Provision) Bill 2022 was signed into law on the 10th of February 2023, by the President of the Federal Republic of Nigeria.

• Nigeria: Business Facilitation (Miscellaneous Provisions) Act, 2022

The Act included changes to the National Housing Fund (NHF).

NHF Contribution

Section 4 of the National Housing Fund Act has been changed as follows:

1. Employees earning minimum wage or above are liable for NHF contributions. Previously, employees with a base wage of N3 000 or more made contributions. Nigeria's current minimum wage is N30 000
2. The 2.5% contribution is calculated based on monthly income. Previously contributions were based on basic salary

Because the Act does not define 'monthly income', the NHF assessable income will remain basic salary until there is clarification.

The effective date was February 2023.

Exemption for private sector employees

The Nigeria Employers Consultative Association (NECA) has advised its members that private sector employees are exempt from NHF contributions. Click here to review the article.

In view of the above, NHF contributions are now voluntary for employees in the Private Sector. This means that employees may choose to continue with the scheme or opt totally.

The Sage payroll systems will remain setup according to the legislation, and employers who know that the NECA letter applies to them can unlink the NHF contributions for their employees.

Application in the payroll:

• The NHF contribution is a system calculation, if you make use of a Deduction Definition with the type 'NHF'
• The NHF contribution calculation is based on the items flagged with "Y" on the NHF column on the Definition screens. You can select what income items must be included for the contribution calculation
• The system does not currently apply any income limit when calculating NHF. If the National Housing Fund (NHF) Status box is ticked on the Employee Information Statutory tab, the contribution will calculate if the employee has any income on the Definition lines flagged for NHF
• As there was no change in the contribution percentage, thus no system changes are required. We however recommend Nigeria Employers to review their System Definitions and Employee records and apply the changes accordingly