Nigeria: Taxes and Costs
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Rental income tax is low
Effective Tax Rate on Rental Income |
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| Monthly Income | US$1,500 | US$6,000 | US$12,000 |
| Tax Rate | 10% | 10% | 10% |
| Click here to see a worked example | |||
Source:
Disclaimer |
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INDIVIDUAL TAXATION
Non-residents are taxed only on income earned in Nigeria.
INCOME TAX
Non-resident individuals are generally subject to withholding taxes. Non-residents can only claim the personal allowance of NGN5,000 (US$34) plus 20% of earned income deduction. No other deductions are available to non-resident individuals.
RENTAL INCOME
Gross rental income earned from leasing out real property is taxed at a final withholding rate of 10%.
The tax rate may be reduced to 7.5% for countries where Nigeria has concluded a double taxation treaty.
CAPITAL GAINS TAX
Capital gains tax is levied at a rate of 10% on the gains realized from the disposal of real property. Property acquisition costs and incidental costs in transferring property ownership (i.e. stamp duty, professional costs, and advertising) are deductible from the market value of the property.
PROPERTY TAX
Land Use Tax
This is a unification of ground rents, tenement rents and neighborhood improvement rates, is imposed on real property, which is assessed by the respective state governments. For Lagos the rates are:
LAND USE TAX |
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| PROPERTY CLASSIFICATION | TAX RATE |
| Commercial Property | 0.375% |
| Residential Property/Commercial | 0.125% |
| Owner Occupied Residential Property | 0.0375% |
| Owner Occupied Pensioner’s Property | EXEMPT |
| Family Compound/ Public, etc. | EXEMPT |
| Source: Global Property Guide | |
CORPORATE TAXATION
INCOME TAX
The corporate tax rate is 30% on net income. Expenses that are necessarily incurred in the production of income are deductible against gross income.
Education Tax
Since 1995, an education tax of 2% of assessable profits is imposed on all companies incorporated in Nigeria.
Nigeria - more data and information
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