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The short answer
Nigeria deducts withholding tax of 10% from dividends paid to non-residents, according to PwC's Nigeria tax summary (reviewed May 2026). The Canada-Nigeria tax treaty allows 12.5% or 15% depending on the shareholding, but where Nigeria's domestic rate is lower, the lower 10% applies. A Canadian resident can generally claim that 10% as a foreign tax credit, limited to the Canadian tax on the dividend.
Readers in Canada who own Nigerian shares, or a stake in a Nigerian company, see the same thing on every dividend: an amount deducted before the money arrives. This guide explains where that rate comes from, whether a treaty changes it, and how to make sure it counts in Canada.
Nigeria's domestic rate
Nigeria's withholding rates are set by the Deduction of Tax at Source (Withholding) Regulations 2024. PwC's Worldwide Tax Summaries table for Nigeria, reviewed 29 May 2026, shows 10% for dividends paid to non-resident companies and to non-resident individuals, the same rate that applies to residents. The company or registrar deducts it and pays it to the Nigeria Revenue Service.
Is it a final tax?
Bamboo's June 2026 guide says that for most individuals the dividend WHT is treated as a final tax. NiDCOM's diaspora guide to the 2026 tax reforms describes 10% WHT on dividends and says non-residents are taxed in Nigeria only on Nigerian-source income. You do not file a Nigerian return just to have it taken. If you are, or become, tax resident in Nigeria, the position may differ under the Nigeria Tax Act 2025; take advice.
What the treaty says
Canada and Nigeria signed a convention on income and capital gains tax in Abuja on 4 August 1992, in force from 16 November 1999 (Canada Treaty Series 1999/48). We could not open the treaty text itself. Udo Udoma & Belo-Osagie's 2022 note says Nigeria's older treaties, including Canada's, set dividend rates of 12.5% or 15% depending on the voting stake, and that where a treaty rate is higher than the domestic rate, the domestic 10% applies.
| Rate | Source | What applies to a Canadian resident |
|---|---|---|
| 10% | Nigerian domestic rate (PwC, May 2026) | This is what is deducted |
| 12.5% or 15% | Canada-Nigeria treaty, per 2022 law firm note | A ceiling only; higher than domestic, so not used |
| 7.5% | Some Nigerian treaties, per PwC | Listed for certain other countries, not Canada |
Some diaspora guides quote 7.5% as the general treaty rate. PwC lists 7.5% for a handful of treaties, such as South Africa, Spain and Sweden; Canada is not one of them. Expect 10%.
Turning it into a Canadian credit
Canada taxes your world income, so the gross dividend goes on your return in Canadian dollars, and the Nigerian tax is claimed as a foreign tax credit. The CRA's Folio S5-F2-C1 sets the rules that matter here:
- The credit is the lesser of the foreign tax paid and the Canadian tax on that income, worked out by country (paragraph 1.74).
- Tax withheld above the rate a Canadian treaty allows is not foreign tax paid; you would seek a refund from the foreign authority instead (paragraph 1.35). At 10%, Nigeria is under the treaty ceiling, so this should not bite.
- Unused non-business foreign tax credits cannot be carried to another year (paragraph 1.24).
- Evidence is normally the foreign tax slip for the withholding (paragraph 1.45).
Worked example
Example only. Rates are illustrative.
A Canadian resident owns 2% of a Lagos company. It declares a ₦5,000,000 dividend to her and withholds 10%, ₦500,000, paying her ₦4,500,000. At an example ₦1,050 per CA$1, she reports CA$4,761.90 of foreign dividend income and CA$476.19 of foreign tax. If her Canadian tax on that dividend is CA$1,428.57 (an example 30%), her credit is the full CA$476.19, leaving CA$952.38 to pay in Canada.
If you own a private Nigerian company
The same 10% applies to dividends from a private company you own, not only listed shares. The difference is that you are often both the person declaring the dividend and the person receiving it, so you control the paperwork. Make sure the company files the withholding, gets a receipt from the Nigeria Revenue Service and gives you a copy; without it, the CRA has no evidence the tax was paid. If a holding of 10% or more of the votes changes what the treaty allows, it still does not push the deduction above the domestic 10%.
Getting the paperwork right
- Ask the registrar or company for a withholding tax receipt or credit note showing the gross dividend and tax.
- Make sure your details at the registrar are current, so dividends are not left unclaimed.
- If more than 10% appears to have been deducted, ask the payer in writing why before you file.
- For dividends from a company you own and want to send abroad in foreign currency, see Nigerian company dividends to Canada.
For the reporting steps on your return, see reporting NGX dividends and the foreign tax credit for Nigerian WHT.
Where Pryme fits
Net dividends paid in naira can be received on a Pryme account and kept in naira, or converted with Swap when you choose, with the rate and fee shown first.
Questions people ask
What is the withholding tax on Nigerian dividends for non-residents?
10%, according to PwC's Nigeria withholding tax table reviewed in May 2026, for corporate and individual non-residents alike.
Does the Canada-Nigeria treaty reduce dividend withholding tax?
No. The treaty rates of 12.5% or 15% are higher than Nigeria's 10%, so the domestic 10% applies, according to Udo Udoma & Belo-Osagie.
Is the treaty rate for Canada 7.5%?
No. PwC lists 7.5% only for certain treaties such as South Africa, Spain and Sweden. Canada is not among them.
Can I claim Nigerian dividend tax in Canada?
Generally yes, as a foreign tax credit limited to the Canadian tax on that dividend, with a tax slip as evidence, per CRA Folio S5-F2-C1.
Sources
- PwC Worldwide Tax Summaries: Nigeria, corporate withholding taxes (reviewed 29 May 2026) · accessed Oct 2026
- Bamboo Learn: tax on Nigerian shares and dividends (26 Jun 2026) · accessed Oct 2026
- NiDCOM / NGEX: Diaspora guide to Nigeria's 2026 tax reforms · accessed Oct 2026
- Publications.gc.ca: Canada-Nigeria tax convention, Canada Treaty Series 1999/48 · accessed Oct 2026
- Udo Udoma & Belo-Osagie via Mondaq: WHT rates on dividend, interest and royalty payments to residents of Nigeria's treaty partners (10 Jun 2022) · accessed Oct 2026
- CRA: Income Tax Folio S5-F2-C1, Foreign Tax Credit (modified 31 Mar 2026) · 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.