By Uche Amunike
Moving from Nigeria to another country can bring better career opportunities, higher salaries, quality education and a new lifestyle. But while preparing for life abroad, Nigerians should not overlook one important issue: taxation.
Understanding tax for Nigerians abroad is important because tax systems differ from one country to another. Your salary, business income, rental income and investments may have tax implications depending on where you live and your tax residency status.
One common mistake is assuming that being a Nigerian citizen automatically determines where you should pay tax. In reality, tax authorities generally consider factors such as where you live, how long you stay there, where you work, your family and economic connections, and where your income comes from.
What is tax residency?
Tax residency is one of the first things Nigerians moving abroad should understand. Being a citizen of a country is not necessarily the same as being a tax resident there. You can remain a Nigerian citizen while becoming a tax resident of the United Kingdom, Canada, the United States or another country. Each country has its own rules.
In the UK, for example, tax residence is determined using the Statutory Residence Test. The number of days you spend in the UK, your home, employment and personal connections can all matter. In some circumstances, spending 183 days or more in the UK during a tax year can make you a UK resident. GOV.UK’s tax residence guidance explains the rules. (gov.uk)
Canada also distinguishes between residents and non-residents. Canadian residents are generally taxed on worldwide income, while non-residents are generally taxed on Canadian-source income. Canada Revenue Agency guidance provides more information. (canada.ca)
Therefore, Nigerians should establish their tax residency instead of relying only on their visa or immigration status.
How does tax work in the UK?
The United Kingdom is one of the most popular destinations for Nigerians seeking to study, work or settle abroad. If you are employed in the UK, Income Tax is generally deducted from your salary through the PAYE system. National Insurance may also be deducted, depending on your circumstances. However, salary is not the only income that can have tax implications.
A Nigerian living in the UK may also receive rental income from a property in Lagos, dividends, investment income or money from a Nigerian business. Depending on the individual’s UK tax residence and circumstances, such foreign income may need to be reported in the UK.
According to GOV.UK’s foreign income guidance, UK residents will normally pay UK tax on foreign income, although specific reliefs may apply. (gov.uk)
The UK tax system also changed significantly from 6 April 2025. The previous remittance basis was replaced by the Foreign Income and Gains regime. Eligible new UK residents may claim relief on qualifying foreign income and gains for their first four years of UK residence, subject to the relevant conditions. HMRC’s 2026 guidance explains the current rules. (gov.uk)
Nigerians who are self-employed or have foreign income that must be declared may also need to complete a Self Assessment tax return.
How does tax work in Canada?
Canada is another major destination for Nigerian students, professionals and families. If you are resident in Canada for tax purposes, you are generally taxed on your worldwide income. This can include employment income, business profits, rental income and investment income earned both inside and outside Canada.
For example, a Nigerian who moves to Toronto but continues receiving rent from a property in Abuja may have tax obligations in Nigeria. If the individual is also a Canadian tax resident, that foreign income may need to be reported in Canada.
Non-residents are generally taxed on Canadian-source income. The Canada Revenue Agency’s guidance for non-residents explains the rules. (canada.ca)
The key point for Nigerians moving to Canada is to determine whether you are resident or non-resident for tax purposes. Your immigration status alone may not answer that question.
How does tax work in the United States?
The United States also requires Nigerians to pay close attention to tax residency. A non-citizen can generally become a U.S. resident for tax purposes by meeting the green card test or substantial presence test, subject to specific exceptions. U.S. citizens and resident aliens are generally subject to U.S. income tax on worldwide income. The Internal Revenue Service provides guidance on the taxation of U.S. residents. (irs.gov)
For example, a Nigerian living in Houston could earn a U.S. salary while continuing to receive rental income from property in Nigeria. If the person is a U.S. tax resident, the Nigerian income may have to be reported in the United States.
However, being taxed in two countries does not necessarily mean paying the full tax twice. The U.S. allows eligible taxpayers to claim a Foreign Tax Credit for certain foreign taxes already paid. IRS Foreign Tax Credit guidance explains how the relief works. (irs.gov)
What happens to income earned in Nigeria?
This is one of the most important issues when discussing Tax for Nigerians abroad. Many Nigerians relocate while continuing to earn money in Nigeria. They may own rental properties, operate businesses, receive dividends or maintain other investments. Moving abroad does not automatically eliminate Nigerian tax obligations.
Nigeria’s tax framework changed significantly from January 2026. Under the new regime, Nigerian residents are generally subject to tax on worldwide income, while non-residents are generally taxed on Nigerian-source income. Residency can involve factors such as domicile, habitual abode, family and economic ties, and physical presence in Nigeria. (PwC Nigeria tax summaries)
This means Nigerians living abroad should determine whether they remain Nigerian tax residents rather than simply assuming that leaving the country ends their tax responsibilities.
For instance, someone who relocates permanently to Canada but owns a rental property in Lagos may still have Nigerian tax considerations relating to the property. Their Canadian tax position may also require the income to be reported there. The correct treatment depends on the person’s circumstances.
What is double taxation?
Double taxation occurs when the same income is potentially taxed by two countries. This can affect Nigerians who live abroad but continue earning income in Nigeria.
For example, a Nigerian living in the UK may receive rent from a property in Lagos. Nigeria may have taxing rights over the Nigerian-source income, while the individual’s UK tax position may also require the income to be reported.
Countries use mechanisms such as tax treaties and foreign tax credits to reduce the impact of double taxation.
The UK provides relief in certain circumstances when income has already been taxed abroad. GOV.UK’s double taxation guidance explains how this works. (gov.uk)
Canada and the United States also have provisions that may provide relief for qualifying foreign taxes.
However, Nigerians should not assume that a double taxation agreement means they will automatically pay no tax. The rules may determine which country has taxing rights or provide a credit against tax already paid.
What happens to your salary abroad?
For Nigerians working abroad as employees, tax is generally deducted directly from their salary by their employer.
However, gross salary is not the same as take-home pay.
Depending on the country, deductions can include income tax, social security contributions, pension contributions and other statutory payments. This is important when comparing job offers abroad. A Nigerian offered £40,000 in the UK, $70,000 in the U.S. or C$80,000 in Canada should not assume that the entire amount will enter their bank account. Understanding your likely deductions helps you create a realistic budget and avoid financial surprises after relocation.
What about Nigerians running businesses abroad?
Tax matters can become more complicated if you are self-employed or operate a business.
A Nigerian who moves abroad and starts an online business, consultancy, restaurant, shop or other enterprise may have obligations relating to income tax and, depending on the country, VAT, GST, payroll or other business taxes.
Remote workers should also pay attention.
If you live abroad while working for a Nigerian or foreign company, the location of your employer does not automatically determine where you owe tax. Your physical location, tax residency and the nature of your work can all matter.
Therefore, Nigerians working remotely should investigate the tax rules where they live rather than assuming that online income is tax-free.
What about Nigerian property and investments?
Many Nigerians abroad continue to own property and investments in Nigeria. These may include houses, land, shares and businesses. The tax treatment depends on the asset, the income it generates and the laws of the countries involved.
For example, rental income from Nigerian property may have Nigerian tax implications. If the owner has become tax resident in another country, that country may also require the income to be reported. Keeping good financial records is therefore important.
Nigerians abroad should retain documents showing rental payments, investment income, bank transactions, property purchases and taxes already paid. Such records can make tax reporting easier and may help when claiming eligible foreign tax relief.
Common tax mistakes Nigerians abroad should avoid
One major mistake is believing that tax only applies to salary. Depending on the country, rental income, business profits, investments, pensions and capital gains may also have tax implications.
Another mistake is assuming foreign income does not need to be reported because tax has already been paid in Nigeria. Some countries may still require the income to be declared while allowing relief for qualifying foreign taxes.
Nigerians should also avoid confusing immigration status with tax residency. A visa, work permit or permanent residence status does not necessarily determine your tax obligations.
Finally, avoid relying entirely on advice from friends or relatives, because tax laws change, and your circumstances may be different from theirs.
Should Nigerians abroad hire a tax professional?
Not everyone needs an accountant, particularly where their only income is a straightforward salary.
However, professional advice can be useful when your finances involve two or more countries.
A professional familiar with international taxation can help you understand your tax residency, foreign income, reporting requirements, property, investments and possible tax credits.
This is particularly useful if you own a business or property, have significant investments or regularly move between Nigeria and another country.
Final thoughts
Understanding Tax for Nigerians abroad should be part of preparing for life outside Nigeria.
The UK, Canada and the United States demonstrate that tax obligations can depend on residency, income sources and personal circumstances rather than nationality alone.
A Nigerian living abroad may still have tax responsibilities in Nigeria, particularly if they own property, operate a business or receive Nigerian-source income. At the same time, their new country of residence may require them to report foreign income.
The best approach is to establish your tax residency, keep proper financial records and check the current rules in both Nigeria and your country of residence.
Tax laws can change, so information that was correct several years ago may no longer apply. Understanding your obligations early can help you avoid unnecessary penalties, unexpected tax bills and financial stress while building your new life abroad.
