The Presidential Fiscal Policy and Tax Reforms Committee has clarified how the new tax laws taking effect in 2026 will impact Nigerians living abroad.
According to the committee’s chairman, Taiwo Oyedele, only income earned or deemed as income—such as salaries, business profits, and investment returns—will be taxed. Personal transfers, including family remittances, gifts, refunds, and community savings, are not taxable.
On double taxation, the committee confirmed that income earned abroad and brought into Nigeria by non-residents will be exempt from tax, whether or not it was taxed overseas. Nigeria’s existing Double Taxation Agreements (DTAs) and new unilateral reliefs ensure the same income isn’t taxed twice.
Tax residency will follow the 183-day rule—those physically present in Nigeria for 183 days or more in a 12-month period are considered residents. Nigerians living abroad who are not tax residents won’t pay tax on foreign income, regardless of dual citizenship.
For investments, income from government bonds and Sukuk remains tax-free. Capital Gains Tax (CGT) applies to real estate sales (excluding owner-occupied homes), while share gains under ₦10 million or proceeds below ₦150 million are exempt. Dividends and rental income face a 10% withholding tax, reduced to 7.5% for residents of certain partner countries.
Foreign pensions and remote work are taxed only if linked to work done in Nigeria. Non-residents earning no Nigerian income are not required to obtain a Tax Identification Number (TIN) or file returns, though simplified online systems like TaxProMax are available for those who must.
NGOs remain exempt if they operate strictly for charitable purposes. Diaspora-owned SMEs in Nigeria are taxed like local firms but qualify for available incentives.
The reforms also emphasize transparency, linking tax revenues to visible infrastructure, curbing corruption, and protecting taxpayer data. Overall, the new laws aim to make Nigeria’s tax system fairer, simpler, and more diaspora-friendly.
