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The short answer
If you move to Nigeria and become Nigerian tax resident while still a director of your UK company, Nigeria taxes you on your worldwide income and the UK taxes you only on UK income. Under the UK-Nigeria treaty, board fees from a UK company may still be taxed in the UK, salary for work done in Nigeria is generally taxed in Nigeria, and UK tax on dividends is capped at 15%; PwC says Nigeria exempts foreign dividends brought in through government-approved channels.
Step one: where are you resident?
Everything depends on residence, and you can be resident in both countries for part of the year of the move. GOV.UK says non-residents only pay UK tax on UK income, while UK residents normally pay UK tax on all their income. UK residence is decided by the Statutory Residence Test, which counts days in the UK and ties such as family, accommodation and work.
On the Nigerian side, PwC's Nigeria summary (reviewed 29 May 2026) says an individual is resident if they have a domicile or habitual abode in Nigeria, family or economic ties there, or are present for 183 days or more; residents are taxed on worldwide income and non-residents only on Nigerian-source income. If both countries treat you as resident, Article 4(2) of the treaty breaks the tie in this order: permanent home, centre of vital interests, habitual abode, then nationality.
Three kinds of payment, three treaty rules
| Payment from the UK company | Treaty article | What it says |
|---|---|---|
| Directors' fees for board membership | Article 16 | Fees paid by a UK-resident company to a Nigerian-resident board member may be taxed in the UK |
| Salary for executive work | Article 15 | Employment income is taxable only where you are resident unless the work is done in the other state |
| Dividends | Article 10 | The UK may tax dividends paid to a Nigerian resident, capped at 15% of the gross dividend for individuals |
The split between a board fee and a salary matters. A sole director who is paid a salary for running the business from Lagos is mostly doing the work in Nigeria, which points to Article 15 and Nigerian tax. A fee paid for sitting on the board points to Article 16, which keeps a UK taxing right. Many small company owners have never separated the two; once you move, it is worth writing down what each payment is for. Our UK-side guide to salary or dividends from a UK company covers how each is set up.
Credit for tax paid twice
Where both countries tax the same income, Article 22 of the treaty gives credit in each direction. In the UK, HMRC's helpsheet HS263 limits the credit to the lower of the foreign tax (or the treaty amount) and the UK tax on the same income. In Nigeria, foreign tax credits come through the Nigeria Tax Act; ask a Nigerian adviser how they apply to your figures.
Dividends and the approved-channel rule
PwC's summary says foreign dividends, rents, interest and royalties brought into Nigeria through government-approved channels remain exempt for Nigerian residents. In practice that points to receiving dividends through the formal banking system, into a domiciliary account at a Nigerian bank for example, with records of the transfer. Dividends kept abroad, or brought in informally, may not get the same treatment. Confirm the current rule and documentation with a Nigerian tax adviser, as the 2025 tax laws changed several items in this area.
Worked example
Example: Bola moved to Lagos in March 2026 and is Nigerian resident from then. Her UK company pays her a small board fee, and she takes most of her income as dividends.
- Board fee: Article 16 lets the UK tax it. She reports it to HMRC as UK income and to Nigeria as worldwide income, claiming credit in Nigeria for UK tax.
- Salary for running the company from Lagos: under Article 15, generally taxable in Nigeria only, because the work is done there.
- Dividends: any UK tax is capped by Article 10. In Nigeria she keeps evidence that the dividends came in through her bank, to support the approved-channel exemption PwC describes.
Before she moved, she checked a separate risk: whether running the company from Lagos makes the company itself Nigerian for tax. See UK company managed from Nigeria: tax residence risk and keeping your UK company after the move.
Records to keep
- Board minutes approving each fee, salary and dividend, with dates.
- Your day count in the UK each tax year.
- Payslips, dividend vouchers and bank statements showing where money was paid.
- Tax returns and payment receipts in both countries, for credit claims.
Where Pryme fits
A Pryme Personal Account can be opened from any country and holds pounds and naira with local details for each, so dividends and fees can arrive in pounds and stay in pounds until you choose to convert with Swap; the rate and fee are shown before you approve. Verifiable statements from receipts and statements, built with VerifyDoc.ai, help when an adviser or tax office asks where money came from. This is information, not tax advice.
Questions people ask
Do I pay UK tax on my UK company salary if I live in Nigeria?
If you are not UK resident, the UK taxes only UK income. Under Article 15 of the treaty, salary for work done in Nigeria is generally taxed in Nigeria; board fees under Article 16 may still be taxed in the UK.
Are UK dividends taxed in Nigeria?
Nigeria taxes residents on worldwide income, but PwC says foreign dividends brought in through government-approved channels remain exempt. Confirm the current rule with an adviser.
What is the treaty limit on UK tax on dividends to a Nigerian resident?
Article 10 caps it at 15% of the gross dividend for individuals.
Which country am I resident in if both say I am?
Article 4(2) of the treaty uses permanent home first, then centre of vital interests, habitual abode and nationality.
Sources
- GOV.UK: 1987 UK-Nigeria double taxation agreement, in force · accessed Oct 2026
- GOV.UK: Tax on foreign income, residence (updated 1 Oct 2026) · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, individual taxation (reviewed 29 May 2026) · accessed Oct 2026
- HMRC HS263: Relief for foreign tax paid 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.