Jul 13,2017

Nigeria Explains Taxes On Citizens Living Abroad

The Finance Minister, Kemi Adeosun, on Thursday gave clarifications on the Nigerian government’s plan on diaspora

Mrs. Adeosun made this clarification during a Facebook LIVE video chat tagged “Tax Thursday”.

While responding to questions during the tax programme monitored by PREMIUM TIMES’ correspondent, Mrs. Adeosun
explained that the new tax regime isn’t meant for all Nigerians living in the diaspora.

“It is not (for) every Nigerian; it is for Nigerians resident for tax purposes… If you are a Nigerian resident for tax
purposes, it means you live in Nigeria for 195 days of the year,” she said.

“We’ve signed bilateral agreements with many countries, there is no double taxation. If you are paying your taxes in
the UK, America or Canada, you are not affected by the scheme.

“However, if you are collecting rents on properties – we found in our profile that a lot of properties are owned by
Nigerians in the diaspora; they collect the rent and remit it to America or they keep it here but they don’t pat tax –
those rents that you collect in Nigeria, to the extent that you didn’t declare them in the country you live in, you
need to declare them under rent.

So, in that regard, some of the diaspora (residents) are affected,” she said.

The minister explained further that Nigerians working and doing businesses abroad are exempted from the tax regime,
adding that it is meant for Nigerian residents.

“The vast majority of Nigerians who are just doing their jobs or running their businesses abroad; No, we are not taxing
you. We are taxing Nigerian residents, many of whom also own properties abroad. So, I need to make that clarification,”
she said.

“There is no tax for people that live, work abroad. You are already paying your taxes there, we don’t have any issues
with you. The people we are targeting are those who are Nigerian residents for tax purposes.

“And the thing is… you must pay tax somewhere. You can’t avoid taxes completely. So, if you are in England, surely you
are paying taxes in England. But if you are a Nigerian resident, and you are paying taxes in England, then we have some
issue with you which is around adequacy of your tax returns and for that we are already comparing notes with the Inland
revenue of the IRS in America.

Mrs. Adeosun however added that those registered as taxpayers in Nigeria would have to pay taxes in Nigeria,
irrespective of wherever they are across the world.

“But if you are resident for tax purposes in Nigeria, you have to pay your taxes in Nigeria. So, if you live abroad,
hold up in London or Dubai for most of the year, but to the extent that you are registered in Nigeria as a taxpayer,
you have to pay your taxes here in Nigeria, including taxes on income that you earn abroad.

“So, a Nigerian that owns a property abroad and rents it out, that income is taxable in Nigeria.

The fact that you didn’t remit it to Nigeria the tax laws don’t make that distinction. The fact that you earned it, you
have to declare in Nigeria and pay tax on it in Nigeria; that’s what the tax law requires and that’s what we will be
enforcing,” she said.

On the issue of taxing first class tickets and luxury coaches, the minister said there were plans to implement the

“I think yes,” she said in response to the question, adding that, “We signed something yesterday on luxury goods;
champagne, brandy, whiskey, wine, jewellery, high-end jewellery.

“We’ve signed something that will bill access charge on first class and business class tickets, we are just doing the
final parts of the implementation and we also want to try and amend the tax payer book on high end cars, luxury cars,”
she said.

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