Nigeria rewrote its tax law from 1 January 2026, and the part that catches expats out is residence. Under the Nigeria Tax Act 2025 you're resident if you meet any one of six tests, and a home kept available for you in Nigeria can be enough on its own, however few days you spend there.
This guide covers Nigerian personal tax for people moving to, living in or leaving Nigeria in the 2026 tax year (the calendar year, 1 January to 31 December 2026): the residence tests, the new income tax bands, rent relief, freelancing, crypto, foreign income, pensions and the visas that let you stay.
The key question is simple. Are you resident under any of the six tests? If you are, Nigeria taxes your worldwide income. If you aren't, it only taxes income from Nigeria.
What's changed: the Nigeria Tax Act 2025 took effect on 1 January 2026. It repealed the Personal Income Tax Act and brought most federal taxes into one law. The first ₦800,000 of taxable income is now tax free and the top rate is 25% above ₦50 million. The old Consolidated Relief Allowance has gone, replaced by rent relief of 20% of the rent you pay, up to ₦500,000. Individuals' capital gains are now added to income and taxed on the same scale, and digital assets such as crypto are chargeable assets. The Federal Inland Revenue Service has been replaced by the Nigeria Revenue Service. Returns for periods before 1 January 2026 are still dealt with under the old laws.
📋 Nigeria tax at a glance for 2026
Topic | Details |
|---|---|
Tax system | Residents pay tax on worldwide income. Non-residents pay tax on Nigerian income only |
Tax year | The calendar year, 1 January to 31 December |
Income tax rates | 0% on the first ₦800,000, then 15%, 18%, 21% and 23%, and 25% above ₦50 million |
All-in on a US$100k salary | About 23.4% (₦133 million at about ₦1,330 to US$1, single, foreign employee with no pension or housing fund deduction) |
Foreign income | Taxed for residents. Foreign dividends, interest, rent and royalties are exempt if brought into Nigeria through approved channels |
Investments and gains | 10% withholding on Nigerian dividends, with no further tax. Gains are taxed at income tax rates, with exemptions for smaller share disposals |
Crypto gains | Taxed at income tax rates of up to 25% |
Residence at a glance | Getting in: easy (any one of six tests, including a home available for your use). Leaving: hard (you have to fail all six in a year) |
Who collects it | Your State Internal Revenue Service if you're resident (for example Lagos or the FCT). The Nigeria Revenue Service for non-residents |
The six residence tests
Why does residence matter so much in Nigeria? Because the Act says a resident individual's income is treated as arising in Nigeria and taxed wherever it arises, whether or not you bring it in.
Image 1 — one test is enough to make you Nigerian tax resident
You're a resident individual for a year of assessment if any of these apply:
Domicile: you're domiciled in Nigeria.
Home: you have a permanent place available for your domestic use in Nigeria.
Habitual abode: you have a place of habitual abode in Nigeria.
Ties: you have substantial economic and immediate family ties in Nigeria.
Days: you spend 183 days or more in Nigeria in a 12-month period, including annual leave and temporary absences.
Diplomats: you serve as a diplomat or diplomatic agent of Nigeria in another country.
The non-resident definition is the mirror image. To be non-resident you need to fail every test: no domicile, no home available for your use, no habitual abode, no substantial economic and family ties, and fewer than 183 days in a 12-month period.
Two practical points follow. First, the 183 days are counted over any 12-month period, not just the calendar year, and short trips out don't stop the count. Second, a family home in Abuja or a flat in Lagos kept ready for you can make you resident even if you spend most of the year elsewhere.
When you become tax resident in Nigeria, and how you stop
Getting in is easy. If you move to Nigeria and take a home there, you can be resident from the start of the year under the home or habitual abode tests, without waiting for 183 days.
Leaving is harder. Residence is tested for each year of assessment, and you only become non-resident in a year where you fail all six tests. Give up the home, move your family and spend fewer than 183 days in any 12 months. We found no exit tax for individuals in the Act.
If you're not resident but work in Nigeria, your pay counts as Nigerian income only where the duties are performed in Nigeria and the pay isn't properly taxed in your country of residence. Lagos State's guidance adds that a treaty can exempt short visits where your employer is abroad and no Nigerian base bears the cost.
Federal law, state collection. The Nigeria Tax Act and the Nigeria Tax Administration Act are federal laws, so the rates, reliefs and residence tests are the same everywhere. But the tax of resident individuals is administered by the tax authority of the state where you live, such as the Lagos State Internal Revenue Service or the FCT Internal Revenue Service in Abuja. Your state is generally the one where you live. The Nigeria Revenue Service deals with non-residents, the armed forces, the police and officers of the Nigerian Foreign Service. States also run their own charges, such as the Land Use Charge on property in Lagos.
👉 Lagos State Internal Revenue Service: personal income tax FAQs
Income tax rates for 2026
Salaries, business profits, pensions, rent, investment income and chargeable gains are added together. Eligible deductions come off, and the rest is taxed on one scale set in the Fourth Schedule to the Act.
Nigeria income tax rates for 2026
Taxable income | Rate |
|---|---|
First ₦800,000 | 0% |
Next ₦2,200,000 (to ₦3 million) | 15% |
Next ₦9,000,000 (to ₦12 million) | 18% |
Next ₦13,000,000 (to ₦25 million) | 21% |
Next ₦25,000,000 (to ₦50 million) | 23% |
Above ₦50,000,000 | 25% |
Source: Nigeria Tax Act 2025, section 58 and the Fourth Schedule, in force from 1 January 2026.
The eligible deductions are your contributions to the National Housing Fund, the National Health Insurance Scheme and a pension under the Pension Reform Act, interest on a loan to build your own home, life assurance premiums for you or your spouse, and rent relief of 20% of the annual rent you pay, up to ₦500,000. You have to claim them and keep evidence.
Some income is exempt. If you earn the national minimum wage or less from a job, that income is exempt. Compensation for loss of employment is exempt up to ₦50 million.
Worked example
You're single, resident in Lagos and work for a Nigerian employer for the whole of 2026, earning ₦133 million (about US$100k at ₦1,330 to the dollar). As a foreign employee you don't join the pension scheme or the housing fund.
The first ₦800,000 is tax free. The next bands cost ₦330,000, ₦1,620,000, ₦2,730,000 and ₦5,750,000.
The ₦83 million above ₦50 million is taxed at 25%, which is ₦20,750,000.
Your income tax is about ₦31.18 million, or 23.4% of your salary, and that's your all-in cost. If you pay rent, rent relief can take up to ₦500,000 off your taxable income, saving up to ₦125,000. Your employer deducts tax monthly through PAYE and pays it to your state's tax authority.
Freelancing in Nigeria
Profits from a trade, business, profession or vocation are taxed on the same scale as salaries, after business expenses. There's no compulsory social security for the self-employed: the contributory pension scheme is voluntary for them through the Micro Pension Plan. On US$100k of profit (₦133 million), that's about ₦31.18 million of tax: 23.4%.
You file a return each year and pay the tax your state's tax authority assesses (Lagos calls this direct assessment). Clients that are companies may withhold tax from your fees: Lagos State's table shows 5% on professional and consultancy fees paid to a resident individual, which you set against your final bill.
The bigger hurdle for a foreigner is immigration. Nigeria's work routes are tied to an employer with an expatriate quota, an investment or a skills endorsement, so check you have a status that lets you work for yourself.
👉 Lagos State Internal Revenue Service: withholding tax rates
Crypto, investments and pensions
Is crypto taxed in Nigeria? Yes. From 1 January 2026 the Act lists digital or virtual assets as chargeable assets and profits from digital asset transactions as income. A resident individual's gains are added to income and taxed on the scale above, so the top rate is 25%. The Nigeria Revenue Service published guidelines on virtual assets on 31 July 2026:
Gains are worked out in US dollars and converted to naira at the Central Bank rate on the date of disposal.
Swapping one token for another is a disposal.
Losses on virtual assets can only be set against gains on virtual assets, and can be carried forward against future ones.
Staking, mining and similar rewards are income when you receive them.
Virtual asset service providers may withhold 1% of gross disposal proceeds in some cases, which counts towards your final bill.
Stamp duty of 1.5% applies to transfers between tokens and naira or other fiat money, collected by the service provider.
Other investments:
Nigerian dividends: 10% is withheld, and the dividend isn't taxed again in your hands.
Interest: 10% withholding applies. Interest on short-term securities and corporate bonds isn't taxed again after withholding, and interest on federal and state government bonds is exempt.
Nigerian shares: gains are exempt if your total disposal proceeds are under ₦150 million and your gains are no more than ₦10 million in any 12 months, or if you reinvest the proceeds in Nigerian shares in the same year.
Your home: the gain on selling your home and up to an acre of land is exempt, once in your lifetime.
Foreign income gets a useful exemption. Dividends, interest, rent and royalties from outside Nigeria are exempt if they're brought into Nigeria through approved channels. Leave them abroad, or bring them in another way, and they're taxable on the scale.
Foreign pensions don't get that exemption. Only pensions, gratuities and retirement benefits under Nigeria's Pension Reform Act are exempt, so a pension from abroad is taxed on the scale (subject to any treaty). The Act has no inheritance tax and no wealth tax.
👉 Nigeria Revenue Service: guidelines on the taxation of virtual assets (July 2026)
👉 Nigeria Tax Act 2025: chargeable assets (section 34) and income tax exemptions
Social security
Nigeria's main payroll contributions are for Nigerians rather than foreign staff.
Contributory pension scheme: at least 18% of monthly emoluments, with 8% from the employee and 10% from the employer, for employers with 3 or more staff. Emoluments can't be less than basic salary plus housing and transport allowances. PenCom says foreigners working in Nigeria aren't required to join, though they can.
National Housing Fund: 2.5% of basic monthly salary. The National Housing Fund Act applies it to Nigerian workers, and also refers to the self-employed without saying whether that covers foreigners.
Health insurance: contributions to the National Health Insurance Scheme are deductible for income tax.
Pension contributions under the Pension Reform Act are deductible, and pensions and retirement benefits paid under it are exempt.
👉 National Pension Commission: FAQs on the contributory pension scheme
👉 Federal Mortgage Bank of Nigeria: National Housing Fund Act
Double tax treaties
Does Nigeria have double tax treaties? Yes, but a small network. The new Nigeria Revenue Service website doesn't yet publish a treaty list, so check the treaty with the other country's tax authority. Treaties in force include the UK (in force since 27 December 1987, effective in Nigeria from 1 January 1988) and South Africa (in force since 5 July 2008). Nigeria signed a treaty with Rwanda in June 2025.
👉 HMRC: UK-Nigeria double taxation agreement
👉 SARS: double taxation agreements with African countries, including Nigeria
👉 Federal Ministry of Finance: Nigeria and Rwanda sign a double taxation treaty
Visas and long stays
Nigeria has no digital nomad or remote work visa. The Nigeria Immigration Service lists these routes:
Tourism e-visa: 30 days, single entry, no extension and no work.
Employment (expatriate) visa: a 90-day entry, then a two-year renewable permit. It needs a job and an expatriate quota approval.
Highly Skilled Immigrant Visa: a five-year multiple-entry residence permit that lets you work, with a recommendation from the Nigerian Skills Gap Assessment.
Retirement visa: a permanent residence route for retirees, with proof of stable retirement income.
None of these carries a tax exemption. Once you're resident under any of the six tests, you're taxed normally.
👉 Nigeria Immigration Service: visa and residence permit classes
👉 Nigeria Immigration Service: tourism visa
Who is Nigeria good for?
How does Nigeria compare for different kinds of mover? Ratings are relative to the 150+ countries TaxPilot covers, based on 2026 rules and the all-in cost. We convert at about ₦1,330 to US$1, close to the Central Bank of Nigeria's official rate in October 2026.
☑️ Who is Nigeria good for? Tax ratings for expats in 2026
Expat profile | Nigeria rating | Why |
|---|---|---|
Employees | Moderate | About 23.4% all-in on a US$100k salary (₦133 million) for a single employee: income tax of ₦31.18 million on the 2026 scale. Foreign employees aren't required to join the contributory pension scheme and the National Housing Fund is for Nigerians, so there's nothing else to add. There's no regime for new arrivals. |
Freelancers (self-employed) | Moderate | About 23.4% on US$100k of profit: the same scale as salaries, with no compulsory social security for the self-employed. You also need an immigration status that lets you work, which is the harder part for foreigners. |
Retirees | Good | About 14% on a US$40k foreign pension plus US$20k of foreign dividends and interest, if the investment income comes into Nigeria through approved channels and is exempt. The foreign pension is taxed on the scale. It's about 22% if the investment income is taxed too. There's no inheritance or wealth tax. |
Crypto gains | Moderate | Digital assets are chargeable assets from 1 January 2026, and gains are added to your income and taxed at up to 25%. A US$100k gain on its own costs about 23.4%. Swapping one token for another counts as a disposal. |
Investment income | Good | About 10.6% on a US$1m portfolio if the 4% income is foreign dividends and interest brought in through approved channels (exempt), and the 4% gains are taxed on the scale. With Nigerian dividends taxed at 10% instead, it's about 15.6%. There's no wealth tax. |
Digital nomad visa | Poor | Nigeria has no digital nomad or remote work visa. The tourism e-visa allows 30 days with no extension and no work, and longer permits are tied to an employer, an investment or retirement. |
👉 Central Bank of Nigeria: official exchange rates
Filing and deadlines
The tax year is the calendar year. Under the Nigeria Tax Administration Act, every taxable person files an annual return with the relevant tax authority without waiting to be asked, including employees, who must declare income from all sources.
PAYE: your employer deducts tax monthly and pays it to your state the following month. The Nigeria Tax Administration Act's deadline for tax deducted at source is the 21st, though states have long used the 10th for PAYE, so check your state's date.
Employer returns: due by 31 January for the previous year.
Your own return: state tax authorities have long required individual returns by 31 March after the year ends (the date in the old Personal Income Tax Act). Check your state's date for the 2026 return.
Penalties: failing to file costs ₦100,000 for the first month and ₦50,000 for each month after. Failing to register costs ₦50,000, then ₦25,000 a month.
👉 Federal Ministry of Finance: transition guidelines for the 2025 tax Acts
👉 Nigeria Revenue Service (Establishment) Act 2025
Frequently asked questions
When do I become tax resident in Nigeria?
You're resident for a year if you meet any one of six tests: you're domiciled in Nigeria, you have a permanent place available for your use there, you have a habitual abode there, you have substantial economic and immediate family ties there, you spend 183 days or more in any 12-month period (including leave), or you're a Nigerian diplomat abroad.
What are the income tax rates in Nigeria for 2026?
The first ₦800,000 is tax free. The next ₦2.2 million is taxed at 15%, the next ₦9 million at 18%, the next ₦13 million at 21%, the next ₦25 million at 23%, and income above ₦50 million at 25%.
Does Nigeria tax foreign income?
Yes, if you're resident. Nigeria taxes residents on worldwide income, whether or not it's brought in. Foreign dividends, interest, rent and royalties are exempt if they're brought into Nigeria through approved channels. Foreign pensions are taxable.
Is crypto taxed in Nigeria?
Yes. From 1 January 2026 digital assets are chargeable assets, and a resident individual's gains are taxed at income tax rates of up to 25%. Swapping one token for another counts as a disposal, and losses can only be set against other virtual asset gains.
Do expats pay pension contributions in Nigeria?
Not compulsorily. The National Pension Commission says foreigners working in Nigeria aren't required to join the contributory pension scheme, though they can. Nigerian employees pay 8% and their employers 10%.
Does Nigeria have a digital nomad visa?
No. The tourism e-visa allows 30 days with no extension and no work. Longer stays need an employment visa with an expatriate quota, the Highly Skilled Immigrant Visa, an investor visa or a retirement visa.
Where to go next
👉 Easiest countries to become tax resident
Important information
This article is general information and does not constitute tax, legal, immigration or financial advice, and does not create a client relationship. Tax outcomes depend on travel history, income sources, treaty status and the law applying to the relevant year. Rates, thresholds and regimes change, and some measures described may be proposed rather than enacted; this article reflects our understanding as at the date of publication. Obtain advice from a suitably qualified professional before acting or refraining from action.
