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The short answer
An Irish company usually pays people in Nigeria in one of three ways: through its own Nigerian entity running a local payroll, through an employer of record that employs the staff for it, or by paying independent contractors against invoices. Only the first two make someone a Nigerian employee with PAYE, pension and other statutory deductions, and Nigeria's Labour Act expects wages in legal tender at intervals of no more than a month. Whichever route you choose, keep a payslip or invoice, a payment record and the exchange rate for every payment.
The three routes, side by side
The first decision is legal, not banking: who is the employer? An Irish company with no Nigerian presence cannot simply run Nigerian PAYE from Dublin as if it were a Lagos employer. It needs either a Nigerian entity, a third party that employs the staff, or a contractor arrangement in which no one is an employee.
| Route | Who employs | Who deducts PAYE and pension | Good fit when |
|---|---|---|---|
| Nigerian subsidiary or branch | Your Nigerian company | Your Nigerian company | You plan a lasting team, an office or local customers |
| Employer of record (EOR) | The EOR provider's Nigerian entity | The EOR | You want employees quickly without setting up an entity |
| Independent contractors | No one; they run their own business | The contractor handles their own tax | The work is project-based and the person controls how it is done |
Each route is covered in more depth in contractor or employee and employer of record for Nigerian staff. If you are setting up a Nigerian company, see registering a CAC company from Ireland.
What Nigerian law expects of a payroll
If you employ through your own Nigerian entity, these are the core rules. The Labour Act says wages are payable in legal tender (a cheque only with the worker's prior written consent), are due at the end of each agreed period, and may not be paid at intervals longer than one month without the State authority's consent. Within three months of starting, a worker must receive a written statement of the main terms. Total deductions in a month may not exceed one third of that month's wages.
Statutory deductions and dates
| Item | Rule | Source and date |
|---|---|---|
| PAYE | Remit on or before the 10th of the month after salaries are paid; annual return of emoluments by 31 January | PwC Nigeria tax administration, reviewed 29 May 2026 |
| Pension | Minimum 18% of monthly emoluments (10% employer, 8% employee); remit within 7 working days of paying salaries | PenCom FAQ, 2023 |
| NSITF | 1% of total monthly payroll under the Employees' Compensation Act | NSITF services page, Oct 2026 |
| ITF | 1% of annual payroll for employers with 5 or more staff, or fewer with turnover of ₦50m or more | Mondaq, Feb 2020 (secondary; confirm with ITF) |
| NHF | Employers should stop deducting unless the employee consents | DLA Piper Africa, 28 Aug 2026 |
The details of each are in Nigerian PAYE for staff of an Irish company, PenCom contributions and NSITF and ITF.
Paying in naira, euro or dollars
Salaries can be agreed in a foreign currency, but the Labour Act's legal-tender rule and the PAYE calculation both point back to naira. DLA Piper's August 2026 payroll guide says employers convert foreign-currency pay to naira at the CBN rate at the time of payment and use that figure for PAYE and other statutory deductions. In practice, most teams are paid in naira into Nigerian bank accounts, with the euro cost recorded in Ireland on the day the money is converted.
Worked example (illustrative)
Your Nigerian subsidiary employs a developer on ₦1,000,000 a month gross. Employer pension is 10% (₦100,000) and employee pension 8% (₦80,000). NSITF at 1% of payroll is ₦10,000. The subsidiary's cost before ITF is ₦1,110,000 for the month, and the developer's pay before PAYE is ₦920,000 after pension. PAYE is then worked out on the taxable figure using the bands in Nigeria PAYE bands for 2026. The Irish parent funds the subsidiary, not the employee directly.
Records an Irish company should keep
For your own Irish accounts, every payment to Nigeria needs a paper trail that links the euro leaving Ireland to the naira arriving, and the naira arriving to a person and a purpose. Revenue's record-keeping guidance asks businesses to keep the original documents used to calculate their tax for six years.
- Contracts: employment contracts held by the Nigerian employer or EOR, or service agreements with contractors.
- Payroll evidence: monthly payslips, the payroll summary, and proof of PAYE, pension and NSITF remittance.
- Funding records: intercompany invoices or EOR invoices, and the transfer confirmations.
- Rates: the rate used for each conversion and its source, applied consistently. See which exchange rate to use.
What to check first
- Decide who the employer is before anyone starts work.
- If it is your own entity, register with the state tax authority, a PFA for pensions, NSITF and, where it applies, ITF.
- Agree the pay currency, pay date and payslip format in writing.
- Set an approval rule in Ireland: who signs off each month's payroll and who can release funds.
- Ask your Irish adviser whether having staff in Nigeria creates any Irish or Nigerian tax presence questions for the parent.
Where Pryme fits
A Pryme Business Account holds euro and naira together, so the Irish side can convert with Swap, seeing the rate and fee before approving, and then pay a Nigerian team in naira through payroll or bulk payouts. The Finance agent can prepare the monthly run; a person approves above a set ceiling, and each action is recorded.
Questions people ask
Can an Irish company pay Nigerian employees directly?
It can send money, but running Nigerian PAYE and pension needs a Nigerian employer: your own entity or an employer of record. Paying people directly without either usually means treating them as contractors.
Should Nigerian staff be paid in naira or euro?
Nigeria's Labour Act says wages are payable in legal tender, and PAYE is calculated in naira. DLA Piper says foreign-currency pay is converted at the CBN rate at payment for deductions.
When is PAYE due for Nigerian staff?
PwC says employers remit PAYE on or before the 10th of the month after salaries are paid, and file the annual return of emoluments by 31 January.
What records does Revenue expect for payments to Nigeria?
Revenue asks businesses to keep the original documents used to work out their tax, such as invoices, receipts and ledgers, for six years.
Sources
- Labour Act (Cap L1 LFN 2004), full text · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, individual tax administration (reviewed 29 May 2026) · accessed Oct 2026
- PenCom: Frequently asked questions (2023 edition) · accessed Oct 2026
- DLA Piper Africa: FAQs on payroll taxes and employer liability (28 Aug 2026) · accessed Oct 2026
- NSITF: Services · accessed Oct 2026
- Revenue: Keeping records (published 20 Oct 2025) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.