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The short answer
NGX dividends arrive in naira, after 10% Nigerian withholding tax, in the bank account on your registrar's record. You can reinvest them through your broker (paying buy-side charges of about 1.1% to 1.7% plus VAT), keep them in naira, spend them in Nigeria, or convert and send them to the UK (paying a transfer fee and an exchange-rate margin). Whichever you choose, UK residents report the gross dividend in pounds, with credit for the Nigerian tax.
Once you hold Nigerian shares, dividends start to arrive: small amounts at first, sometimes twice a year from the same company. Each payment raises the same question for a UK-based investor. Should the money stay in Nigeria and buy more shares, or come home? The answer depends on costs, on what you need the money for and on the UK tax that is due either way.
What arrives and where
Dividends are paid by the company's registrar into the Nigerian bank account on your record; CSCS directs dividend claims to registrars. Nigerian withholding tax is deducted first: the 2024 withholding regulations summarised by PwC set dividend withholding at 10% for both residents and non-residents. The UK–Nigeria tax treaty (Article 10) limits Nigerian tax on dividends to 15% for ordinary shareholders, so 10% is within that limit.
Your four options
| Option | What it costs | Suits you if |
|---|---|---|
| Reinvest in NGX shares | Buy-side charges each time: brokerage 0.75% to 1.35%, SEC fee 0.3%, stamp duty 0.08%, plus VAT on some items | You are building a long-term naira portfolio |
| Keep in naira | Nothing to convert; naira savings rates vary | You have naira costs coming, such as fees or building work |
| Spend in Nigeria | No conversion; you avoid sending pounds the other way | You support family or pay bills at home |
| Move to the UK | Transfer fee plus the exchange-rate margin against the mid-market rate | You need the money in pounds or want to reduce naira exposure |
The charges for reinvesting come from NGX's published market structure page; small dividends lose a larger share to fixed charges such as the ₦4 trade alert and any broker minimum, so many investors let several dividends build up before buying.
Worked example: reinvesting
Example only. Yemi in Cardiff receives a dividend of ₦500,000 gross; ₦50,000 is withheld, leaving ₦450,000. If she reinvests it all at 1.35% brokerage, with the SEC fee and stamp duty, the charges come to 1.73%, or ₦7,785 before VAT, so about ₦442,215 goes into new shares.
The UK tax is the same whichever you choose
For UK residents, foreign dividends are taxable whether or not you bring the money to the UK, and they go on the foreign pages of your Self Assessment return. HMRC's SA106 notes say to include all dividend income, even if under £500, and to convert it using the exchange rate at the time the income arose. For 2026 to 2027, GOV.UK lists a £500 dividend allowance and rates of 10.75% (basic), 35.75% (higher) and 39.35% (additional).
HMRC's helpsheet HS263 explains that foreign tax credit relief is the lower of the foreign tax paid and the UK tax on the same income. Example only: a dividend worth £250 gross with £25 of Nigerian tax, taxed at the basic rate after your allowance is used, gives UK tax of £26.88 (10.75%); the £25 credit leaves £1.88 to pay. A higher-rate taxpayer would owe much more. See NGX dividends, withholding tax and UK credit.
Moving dividends to the UK
- Compare the rate you are offered with the mid-market rate at the time; the gap is part of your cost.
- Check the fixed fee per transfer; batching several dividends into one transfer reduces it.
- Keep the registrar's dividend advice, which shows gross, tax and net, for your Self Assessment.
- Keep a record of the date and rate when you converted; it is separate from the rate HMRC asks you to use for the income.
Make sure dividends can reach you
Dividends go to the bank account the registrar holds for you. If that is an old account you closed when you moved to the UK, payments can fail and sit as unclaimed. Check each registrar's record for every company you hold, and update it to a Nigerian account in your own name. If you have lost track of older holdings, CSCS says it can run a global search across brokers and registrars at its Lagos or Abuja office, or on request through your broker. See dormant shares and unclaimed dividends.
- Keep a list of every company, its registrar and the account on record.
- Note expected dividend months so you notice a missing payment.
- Keep each dividend advice; it is your evidence of gross, tax and net for HMRC.
A simple rule of thumb
If you have naira costs ahead, holding or spending dividends in Nigeria avoids converting twice. If you are building a portfolio, let dividends accumulate and reinvest in larger amounts. If you want less exposure to the naira, move the money home in batches. Many investors split dividends between these.
Where Pryme fits
Pryme keeps naira and pounds in one account, so dividends can sit in naira until you decide. Swap converts when you choose and the app shows the rate and the fee before you approve. For naira you plan to keep in Nigeria, Savings Boxes hold naira for set goals, with rates shown in the app. See also moving Nigerian share dividends to the UK.
Questions people ask
Should I reinvest my Nigerian dividends?
It depends on your plans. Reinvesting builds a naira portfolio but adds buy-side charges and keeps your money in naira.
How much tax is taken from NGX dividends?
10% withholding tax under the 2024 regulations summarised by PwC, within the 15% limit in the UK–Nigeria treaty for ordinary shareholders.
Do I pay UK tax if I leave the dividends in Nigeria?
Yes. UK residents are taxed on foreign dividends whether or not the money comes to the UK, with credit for Nigerian tax.
Which exchange rate do I use for HMRC?
HMRC's SA106 notes say to use the rate at the time the income arose.
Sources
- PwC Nigeria: highlights of the Deduction of Tax at Source (Withholding) Regulations 2024 · accessed Oct 2026
- UK–Nigeria Double Taxation Convention 1987 (GOV.UK PDF) · accessed Oct 2026
- NGX: Exchange-traded funds, market structure and transaction costs · accessed Oct 2026
- HMRC: SA106 Foreign notes 2026 · accessed Oct 2026
- HMRC: Relief for foreign tax paid 2026 (HS263, updated 6 Apr 2026) · accessed Oct 2026
- CSCS: FAQs · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.