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The short answer
It can be. Land held as an investment is capital property, and a loss on selling it is a capital loss that the CRA lets you set against taxable capital gains of the year, the three previous years or future years. A loss on personal-use property is generally not allowed, and a deal where you never acquired anything raises a separate question about whether there was property to dispose of at all.
Many Nigerians in Canada have a land story that went wrong: a plot sold back at a loss after a dispute, land that lost value when an estate stalled, or money paid to someone who never delivered title. Whether Canada gives you any tax relief depends on what you actually owned, why you held it and how the deal ended. This piece takes each case in turn.
Investment land: a capital loss in principle
The CRA’s capital gains guide, T4037 (modified 11 February 2026), lists vacant land among the types of real estate reported on Schedule 3. When you sell capital property for less than its adjusted cost base plus selling costs, the difference is a capital loss. Under the guide, a capital loss first reduces your capital gains for the year; any excess becomes a net capital loss that can be applied to taxable capital gains of the three preceding years and of future years.
A capital loss cannot be set against salary or other ordinary income. If you have no capital gains now, the loss waits until you do.
When the loss is not allowed
The guide is clear that although you must report a gain on personal-use property, you generally cannot claim a loss on it. Personal-use property is something owned mainly for the personal use or enjoyment of you and your family, such as a holiday home. If you bought the plot to build a family house you meant to use yourself, the CRA may see it as personal-use rather than investment property. Your records about why you bought it (plans, correspondence, whether you ever intended to sell) matter.
The deal that never completed
If you paid a seller or agent and never received a valid title, you may not have acquired land at all. The loss then looks less like the sale of land and more like money lost to a failed contract or fraud. The T4037 guide does not address this case directly, and the right treatment depends on the facts. Pursue recovery first; a Canadian tax professional can then advise whether any loss can be claimed and in which year.
Currency: the loss is measured in Canadian dollars
The T4037 guide says that for foreign property you convert the proceeds at the exchange rate at the time of sale, the cost at the rate when you acquired it, and selling expenses at the rate when they were incurred. Naira movements can therefore create a Canadian loss even when you sold for more naira than you paid, or wipe out a loss you made in naira.
Worked example (illustrative rates and amounts)
| Item | Naira | Rate used (example) | CAD |
|---|---|---|---|
| Cost of plot, 2019 | ₦18,000,000 | ₦265 per $1 | $67,925 |
| Survey and legal costs, 2019 | ₦1,200,000 | ₦265 per $1 | $4,528 |
| Sale proceeds, 2026 | ₦40,000,000 | ₦1,000 per $1 | $40,000 |
| Agent commission on sale, 2026 | ₦2,000,000 | ₦1,000 per $1 | $2,000 |
In this example the plot more than doubled in naira, but in Canadian dollars the result is $40,000 minus $2,000 minus $67,925 minus $4,528, a capital loss of $34,453. At the one-half inclusion rate the guide describes, the allowable capital loss would be $17,226.50, usable only against taxable capital gains. The Bank of Canada does not publish a naira rate, so you need another source that meets the CRA’s tests; see our guide to a CAD cost base for naira assets.
What to keep
- The purchase agreement, receipts and the title documents (C of O, deed of assignment, Governor’s consent where obtained).
- Evidence of the exchange rate used on each date, from a consistent, verifiable source.
- Survey, legal and agency invoices, with dates.
- The sale agreement and proof of what you received.
- Anything showing why you held the land, such as an investment plan or a listing for sale.
Investment land also counts as specified foreign property for Form T1135 at its cost amount, so a large plot can push you over the $100,000 reporting threshold while you own it. See Nigerian land and the T1135.
Where Pryme fits
If you are paying for land or receiving sale proceeds, a Pryme account keeps naira in naira, and verifiable receipts and statements from VerifyDoc.ai (receipts) give you dated records of each payment. Before any conversion, the app shows the rate and the fee before you approve.
Questions people ask
Can I claim a loss on land in Nigeria on my Canadian return?
Yes, if the land was capital property held as an investment and you disposed of it. The capital loss offsets capital gains, not salary.
What if I bought the land to build a family home?
Then it may be personal-use property, and the CRA generally does not allow losses on personal-use property.
I was scammed and never got title. Is that a capital loss?
Not necessarily. If no land was acquired there may be no disposition of property. The treatment depends on the facts, so get professional advice.
How long can I carry the loss?
The T4037 guide says net capital losses can be applied to taxable capital gains of the three preceding years and of future years.
Sources
- CRA guide T4037, Capital Gains (modified 11 Feb 2026) · accessed Oct 2026
- CRA: Questions and answers about Form T1135 (modified 19 Oct 2026) · accessed Oct 2026
- CRA Income Tax Folio S5-F4-C1, Income tax reporting currency (updated 27 Jun 2024) · accessed Oct 2026
- Bank of Canada: Daily exchange rates (table dated 23 Oct 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.