- Nigeria has increased corporate capital gains tax to thirty percent as of January one, twenty twenty-six.
- New rules target offshore share sales if more than fifty percent of value derives from Nigerian assets.
- Individual gains are now taxed under personal income bands with rates reaching up to twenty-five percent.
Nigeria’s tax reform began taxing corporate gains at 30% and brought offshore share sales linked to Nigerian assets within the country’s rules on January 1, 2026. The changes replace the former standalone 10% Capital Gains Tax for most purposes.
The Nigeria Tax Act 2025 also changed how individuals are assessed. Their gains generally fall within personal income tax bands rather than a separate flat rate, with applicable rates reaching 25%.
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The law reaches beyond direct sales. A disposal of shares in a foreign entity may be treated as connected to Nigeria when more than 50% of the entity’s value came, directly or indirectly, from Nigerian assets during the previous 365 days.
That rule gives Nigeria a claim over some offshore transactions. It can affect deals structured outside the country.
The Nigeria Revenue Service issued fresh guidance on August 11, 2026, addressing valuation, the allocation of proceeds in partial disposals and transitional treatment for instalment sales. Advisers also said the agency released nine information circulars on August 13–14 to explain implementation of the wider 2025 reforms.
Offshore share sales now face a Nigerian asset test
The new framework treats the location of the seller as only one part of the analysis. The asset base behind a foreign company can determine whether Nigeria treats a share disposal as having a Nigerian connection.
The test looks backward over 365 days. More than 50% of value must derive from Nigerian assets, either directly or through another structure.
An analysis published by PwC on Nigeria’s capital-gains reforms describes the rules as operational and says they widen Nigeria’s taxing rights over offshore structures and foreign share disposals connected with Nigerian assets.
The change also affects transaction planning. Companies selling interests in groups with Nigerian property or businesses may need to examine the underlying assets, valuation evidence and the timing of the sale.
Companies face a higher rate, while individuals move into income bands
Corporate chargeable gains now generally align with the 30% corporate income tax rate. That is three times the former 10% charge.
Individuals follow a different route. Their gains are assessed under the applicable personal income tax bands, which can reach 25%, rather than under a separate flat levy.
The final amount depends on the asset, the seller’s status and whether an exemption or threshold applies. The revised treatment therefore does not produce one rate for every investor.
A broader small-company exemption can remove some businesses from the charge. Reports describe the exemption as covering companies with annual gross turnover of ₦100 million or less and fixed assets not exceeding ₦250 million.
A separate practitioner summary identifies a possible exemption for disposals of ownership interests in Nigerian companies where aggregate proceeds stay at or below ₦150 million and gains do not exceed ₦10 million during any 12 consecutive months. That threshold is reported separately from the small-company exemption.
Some private and smaller transactions may remain outside the charge
The framework also provides for a possible exemption on gains from a principal private residence when statutory conditions are satisfied. The exemption does not apply automatically to every property sale.
The reported thresholds create different tests for different taxpayers and transactions:
| Area | Reported condition |
|---|---|
| Small-company exemption | Annual gross turnover of ₦100 million or less; fixed assets not exceeding ₦250 million |
| Nigerian company ownership-interest disposal | Proceeds of ₦150 million or less and gains of ₦10 million or less within any 12 consecutive months |
| Principal private residence | Exemption may apply when statutory conditions are met |
| Foreign-entity share disposal | More than 50% of value derived from Nigerian assets during the prior 365 days can bring the sale within the rules |
The conditions require separate review. A company-size exemption does not answer whether an offshore transaction meets the asset-value test, and a residence exemption concerns a different type of disposal.
New guidance fills in valuation and transitional questions
The August 11 guidance focuses on mechanics that can affect the taxable gain. It covers valuation rules, partial-disposal apportionment and instalment sales during the transition to the new regime.
The nine circulars issued on August 13–14 add to that implementation effort. The measures cover the 2025 tax reforms broadly, including the revised treatment of gains.
Nigeria Revenue Service Chairman Zacch Adedeji has said the service is open to resolving concerns about the capital-gains rules. The agency’s implementation activity comes as advisers assess how the provisions work in transactions involving domestic and offshore assets.
The reforms took effect on January 1, 2026. Their practical reach will depend on the taxpayer’s classification, the asset’s connection to Nigeria and the exemptions that apply to the particular sale.
This article is for informational purposes only and does not constitute tax advice. Consult a qualified tax professional or CPA about your specific situation.
