Payroll outsourcing in Nigeria: what's included and when it makes sense
Payroll has to be right every month, on time, and in line with PAYE, pension and NHF rules. Many Nigerian businesses reach a point where the person running it in Excel is stretched, and the question becomes: buy software, or hand payroll to someone else? There are really three options, and they suit different companies.
October 2026 · 5 min read
Option 1: run payroll yourself, on software
Your HR or finance team enters changes, reviews the run and approves it, and the software calculates PAYE, pension, NHF and NSITF and produces payslips and schedules. It suits companies with someone who knows payroll and wants control in-house. It is also the cheapest option.
Option 2: managed payroll
A payroll specialist from the provider prepares and checks each run with you, validates changes such as new starters and salary reviews, and reconciles after payment. You still approve payroll before anyone is paid, and you can see everything in the same software. It suits companies that want payroll done properly without the monthly workload.
Option 3: full HR and payroll outsourcing
The provider takes on agreed HR and payroll operations entirely, under a contract that sets out exactly what they do. It suits companies with no HR or payroll team at all.
Who files PAYE and remits pension?
This is the most important question to settle in writing. Under Nigerian law the employer stays responsible for deducting and remitting PAYE to the State Internal Revenue Service and pension to each employee's PFA, whoever prepares the payroll. Some providers prepare the schedules and leave filing to you; others take on remittance under contract. Make sure your agreement says which.
Questions to ask any payroll provider
- Who prepares payroll each month, and who approves it?
- What exactly do you do, and what stays with us? Is it in the contract?
- Who files PAYE and remits pension, NHF and NSITF?
- Can we see every calculation and payslip ourselves?
- How do you handle a change in tax law?
- What happens if a payroll is wrong, and who pays for the correction?
- Can we move between software-only and managed as we grow?
How 234 Talent Solutions offers all three
You can run payroll yourself on 234 Solutions from ₦85,000 a month (HR Essentials), or have our team run it for you, from managed payroll to agreed HR operations, under a quote for your payroll. You can move between them as you grow, without changing systems. The services page compares them side by side.
This is general guidance, not legal or tax advice. Confirm your obligations with your State IRS, PenCom and a qualified adviser.