How dividend tax works in Nigeria
Nigerian dividends face 10% withholding at source for residents and non-residents, companies and individuals alike. The rate survives the 2026 reform unchanged.
Treaties with China, Singapore, South Africa, Sweden, Spain and South Korea cut qualifying dividends to 7.5% with residence certificates. All other payouts stay at 10%.
Franked investment income — dividends that already suffered withholding — is excluded from the recipient's taxable income, so cash is not taxed twice. Non-residents stop at the withholding.
Tax rates at a glance
- Standard withholding
- 10%Final
- Treaty rate
- 7.50%
- Treaty partners
- 6
- Franked income
- Excluded
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
InvestorsHolding companiesFamily officesHigh earnersCross-border shareholders
Watch out for
- Ten percent applies to everyone with no allowances. Small retail dividends face the same rate as institutional payouts.
- Treaty 7.5% needs certificates and conditions. Without documentation, payers must withhold the full 10%.
- Excess-dividend rules survive modified. Distributions from untaxed profits can trigger company-level charges beyond the withholding.
- Withholding is final for non-residents but franked for residents. The two mechanics differ even though the rate matches.
Frequently asked questions
Does Nigeria tax dividends?
Yes, at 10% withholding for all recipients, with 7.5% for six treaty partners and franked income excluded from further tax.
What withholding applies to dividends leaving Nigeria?
Domestic law withholds 10%, reduced to 7.5% for China, Singapore, South Africa, Sweden, Spain and South Korea with documentation.
Are dividends taxed twice in Nigeria?
No. Franked investment income already suffering withholding is excluded from the recipient's taxable income.