Tinubu’s New Tax Policy: What Nigerians Abroad Must Know Before January 2026

To allay worries expressed by Nigerians living abroad over the new tax reforms that will go into effect in 2026, the Presidential Fiscal Policy and Tax Reforms Committee has issued comprehensive explanations.

According to reports, the clarification was included in a document that was made available to reporters on Thursday, October 30, 2025, and signed by Taiwo Oyedele, the committee chairman.

Gifts and Remittances Are Not Taxable
The committee states that gifts, refunds, community savings contributions, and family remittances are not considered taxable income.

The statement made it very clear that “genuine personal transfers such as family remittances, gifts, refunds (e.g., flight tickets), or community savings contributions are not treated as taxable income.”

Individuals must self-report any income that is eligible for taxation, such as wages, business profits, and investment returns.

Foreign Earnings Are Not Double Taxed
The committee stressed that Nigerians living overseas who do not reside in Nigeria will not be subject to taxes on their foreign work or company income, allaying widespread worries about double taxation.

According to the statement acquired by The PUNCH, “income earned abroad and brought into Nigeria by a non-resident individual is now specifically exempt from tax in Nigeria regardless of whether tax was paid abroad or not.”

It further stated that Nigerians living overseas would continue to be protected from double taxation under Nigeria’s Double Taxation Agreements (DTAs) with a number of nations, although unilateral relief has been given in the absence of DTAs.

According to the text, the “183-day rule” will be used to assess tax residency.

The 183-day rule, which counts the total number of days spent physically in Nigeria during a 12-month period, is the basis for residency. The committee stated that non-residents are only subject to taxes on income that comes from Nigeria, such as dividends, rental income, and commercial earnings.

It made clear that a person’s tax position is unaffected by dual citizenship.

The Taxation of Diaspora Investments
The committee stated that diaspora investments in Nigeria will either be free, subject to withholding tax as the ultimate tax, or subject to capital gains tax (CGT).

Exemptions: Sukuk and other government bonds are exempt from taxes.

Real estate sales are subject to capital gains tax (owner-occupied residences excluded). Up to ₦150 million in profits and ₦10 million in annual gains, shares are exempt.

Withholding Tax: The final tax on dividends, interest on non-government bonds, and rental income is 10%, which is lowered to 7.5% for citizens of the UK, South Africa, and China.

Pensions and Remote Work
The committee clarified the following about pensions and remote work: “Only income that arises in Nigeria is taxable for non-residents.” Nigeria does not impose taxes on foreign pensions and stipends unless they are earned in the country.

“Remote workers are taxed according to the laws of the nation in which they reside or generate such income, not just where payment is made.”

The committee clarified that Nigerians living abroad who do not receive income from Nigeria are not required to file yearly tax returns or obtain a Tax Identification Number (TIN).

“Unless you receive employment or business income from Nigeria, there is no requirement to file tax returns and a TIN is not required,” it explained.

However, people in Nigeria who have taxable company or job income are required to file returns. To make compliance easier, platforms like TaxProMax and online TIN registration have been introduced.

Additionally, the amendments give diaspora-owned businesses clarity:

NGOs: If they comply with reporting requirements and are registered only for charity reasons, they are exempt from taxes.

Diaspora-Owned SMEs are treated similarly to local companies; they are subject to profit-based taxes but are also eligible for corporation tax relief and other benefits.

Openness and Rewards

Stronger transparency measures to guarantee that tax revenues are linked to visible infrastructure and public services with protections against corruption are included in the reforms, according to the committee.

Regarding incentives, it stated that certain reliefs are available for diaspora-led investments in priority industries like manufacturing, agriculture, and the creative sector. SME tax exemptions and real estate VAT exemptions are additional incentives.

The group emphasized that the changes were intended to be “fairer and more diaspora-friendly.” Nigerians living overseas who do not reside in Nigeria will not be required to pay taxes on their foreign earnings, remittances, pensions, or earnings from remote labor unless they originate in Nigeria.

Nonetheless, Nigerians living abroad who earn money from businesses, rentals, or investments in Nigeria will still be subject to taxes in accordance with current legislation, with certain exclusions and reliefs possible based on the type of income.

Oyedele claims that the changes “address incidence of double taxation, align Nigeria with global best practices, simplify compliance, and provide clarity on where tax is payable or filing obligation arises.”