UK-Nigeria Double Tax Agreement (1987)
The Convention Between the United Kingdom and the Federal Republic of Nigeria for the Avoidance of Double Taxation was signed in 1987 and remains in force. Key provisions: Article 15 (employment income) — taxed where work is performed; Article 10 (dividends) — UK/Nigeria withholding rates reduced for treaty residents; Article 11 (interest) — withholding reduced; Article 12 (royalties) — withholding reduced. The DTA provides a residency tiebreaker for individuals who might otherwise be treated as resident in both countries (Article 4 — based on permanent home, center of vital interests, habitual abode, nationality). For Nigerians moving to the UK: if you break Nigerian tax residency (typically by spending fewer than 183 days in Nigeria and having no significant Nigerian connections), UK tax residency applies and the DTA prevents the same income from being taxed in both countries. For ongoing Nigerian-source income (business income, rental properties, investments) while living in the UK: FTC for Nigerian taxes paid offsets UK tax on the same income.
UK Non-Dom Reform 2025: The Temporary Repatriation Facility
Historically, non-UK-domiciled UK tax residents could use the 'remittance basis' — paying UK tax only on foreign income and gains actually remitted (brought into) the UK. Many Nigerian immigrants in professional roles used the remittance basis for Nigerian business income, rental income, and investments that remained in Nigeria. From April 6, 2025: the remittance basis is abolished. Replacement: a new Foreign Income and Gains (FIG) regime. New arrivals (who have not been UK tax residents in any of the 10 years before the current tax year): 4-year relief period during which foreign income and gains are exempt from UK tax regardless of remittance. After 4 years: worldwide taxation applies (same as UK-domiciled residents). Temporary Repatriation Facility (TRF): those who used the remittance basis and have pre-April 2025 foreign income/gains not yet remitted can bring these funds to the UK at a preferential 12% tax rate (2025/26 and 2026/27) or 15% (2027/28). Impact for Nigerians: new UK arrivals from Nigeria get a 4-year tax holiday on Nigerian-source income; established non-doms with unremitted Nigerian income should evaluate the TRF window.
UK Tax Residency: Statutory Residence Test
UK tax residency is determined by the Statutory Residence Test (SRT) introduced in 2013. A Nigerian arriving in the UK becomes UK tax resident if they: (1) spend 183+ days in the UK in a tax year (automatic UK resident); (2) have their only home in the UK for at least 91 days; (3) work full-time in the UK for a period covering more than 365 days. Automatic non-residence: spend fewer than 16 days in UK (if UK resident in any of prior 3 years) or fewer than 46 days (if not UK resident in any of prior 3 years). The 'sufficient ties' test: for those in between, UK and family/work/accommodation ties are counted to determine residency status. Tax year: April 6 to April 5 (UK fiscal year). Year of arrival: split-year treatment may apply — you're only UK tax resident from the date of arrival, not for the full year. Split-year means only income earned after UK arrival is subject to UK tax for the first year.
Nigerian Tax Obligations as a UK Resident
Nigerian federal income tax (PITA — Personal Income Tax Act): Nigerian residents are taxed on worldwide income. However, Nigerians who leave Nigeria and establish non-residency (fewer than 183 days in Nigeria, no permanent home in Nigeria, no significant Nigerian business presence) are taxed only on Nigerian-source income. As a Nigerian-origin UK resident: you may owe Nigerian tax on: rental income from Nigerian property; business income from a Nigerian business you actively run; dividends from Nigerian companies (subject to withholding tax at source). Nigerian FIRS (Federal Inland Revenue Service): personal income tax administration for employees is handled by state-level tax authorities (LIRS — Lagos Internal Revenue Service, etc.); for businesses and investment income, FIRS. Withholding Tax (WHT) in Nigeria: 10% on dividends, 10% on interest, 10% on rent. These withheld amounts create a credit against UK tax via the DTA / FTC mechanism. File Form SA106 (HMRC) to claim UK relief for Nigerian taxes paid.
UK PAYE, National Insurance, and Skilled Worker Visa
Nigerians in the UK on a Skilled Worker visa (formerly Tier 2) are fully subject to UK PAYE (income tax and National Insurance) from day one of employment. UK income tax rates (2024/25): personal allowance £12,570 (note: personal allowance reduces by £1 for every £2 above £100,000, eliminated at £125,140); 20% (£12,571–£50,270); 40% (£50,271–£125,140); 45% (above £125,140). National Insurance: employee rate 8% on earnings £12,570–£50,270; 2% above £50,270. Employer rate ~15% on earnings above £5,000/year (secondary threshold — increased from 13.8%/£9,100 from April 2025). No separate FBAR equivalent in the UK, but overseas assets disclosures may be required on SA108 for capital gains and SA106 for foreign income. Graduate visa holders: same tax obligations as Skilled Worker visa holders — full PAYE and NI from employment start. NHS surcharge: paid as part of visa application; covers NHS healthcare entitlement. Student visa → Graduate visa: during the student visa period, you are taxed on UK-source income; foreign income falls under normal residency rules.