AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
There is no social security agreement between the UK and Nigeria, so there is no certificate of coverage like the A1 used in Europe. Under HMRC's NI38 guidance, Class 1 National Insurance usually continues for the first 52 weeks abroad if the employer has a UK place of business and the employee was UK resident before leaving. Income tax depends on residence in each country and on Article 15 of the UK-Nigeria tax treaty.
Moving a UK employee to Lagos for six months or two years is a common step for a growing UK-Nigeria business. The payroll questions arrive at once: does UK National Insurance stop, does Nigeria tax the salary, and who runs which payroll? The answers depend on the length of the secondment, who bears the cost, and where the employee is resident.
National Insurance: the 52-week rule
HMRC's guidance on social security abroad (NI38, updated July 2026) lists the EU countries and the countries with which the UK has a social security agreement. Nigeria is on neither list. For a non-agreement country, NI38 says Class 1 contributions must be paid for the first 52 weeks of work abroad if all of these apply:
- the employer has a place of business in the UK;
- the employee is ordinarily resident in the UK;
- the employee was resident in the UK immediately before starting the work abroad;
- no social security agreement covers the employment.
Class 1 is then payable by both employer and employee just as if the work were in the UK, at the same rates, through UK payroll. After 52 weeks, the compulsory Class 1 liability stops and the employee can choose to pay voluntary contributions to protect their record. GOV.UK's voluntary rates page gives Class 2 at £3.65 a week and Class 3 at £18.40 a week for 2026-27; which class is available depends on the person's circumstances, so check NI38 before paying. NI38 also warns that if Class 1 was not paid when it should have been for the first 52 weeks, Class 2 or 3 cannot be paid instead for that period.
Because there is no agreement, Nigeria's own rules on pension and social contributions apply independently. Ask the Nigerian entity's payroll adviser what local contributions apply to a seconded expatriate.
UK income tax: is the employee still resident?
The Statutory Residence Test decides UK residence. HMRC's RDR3 guidance includes an automatic overseas test for full-time work abroad: broadly, working full time overseas with fewer than 91 days in the UK in the tax year and fewer than 31 days on which more than three hours are worked in the UK, with no significant break. A long secondment can make the employee non-resident; a short one usually does not. If the employee stays UK resident, the UK taxes their worldwide employment income, with relief for Nigerian tax under the treaty.
Nigerian tax: the 183-day test in the treaty
Article 15 of the 1987 UK-Nigeria double taxation agreement says employment income is taxable where the work is done. Pay for work in Nigeria is exempt from Nigerian tax only if all three conditions are met:
- the employee is in Nigeria for no more than 183 days in the relevant tax year;
- the pay is not from an employer resident in Nigeria;
- the pay is not borne by a permanent establishment or fixed base the employer has in Nigeria.
The second and third conditions catch many groups. If the Nigerian subsidiary is recharged the employee's cost, the pay is borne in Nigeria and the exemption is lost even for a short stay. Separately, Nigerian domestic law treats an individual as resident on several grounds, including 183 or more days in any 12-month period or a permanent home available for use, according to PwC's 2026 summary.
Example
Example only. An analyst spends 120 days in Lagos in the year, stays on UK payroll, and the cost is not recharged. The treaty test is likely met, so Nigeria should not tax the pay, UK PAYE and Class 1 continue, and no Nigerian payroll is needed. Change one fact (the subsidiary is recharged the salary) and Nigerian PAYE becomes due on the Lagos workdays, with UK credit for the Nigerian tax.
Immigration and permits in Nigeria
A secondee is a foreign worker in Nigeria (unless a Nigerian citizen), and the Nigerian company usually needs expatriate quota approval and the right visa and residence permit. KPMG's April 2025 summary of the Ministry of Interior reforms describes an online Expatriate Administration System and the move to electronic CERPAC. See expatriate quota for UK staff in Nigeria.
What to check first
- Expected length of the secondment and days in each country.
- Which entity employs, pays and bears the cost.
- Whether the employee will remain UK resident under the SRT.
- Nigerian permit route, and Nigerian payroll if the 183-day treaty exemption does not apply.
Where Pryme fits
A secondee often needs pounds at home and naira in Lagos. A Pryme Personal Account holds both, and the employer's payroll tools on a Pryme Business Account handle naira salary runs, with a person approving each run. See also Nigerian PAYE for a UK employer and per diems for short trips.
Questions people ask
Can I get an A1 certificate for Nigeria?
No. The A1 is a European form, and the UK has no social security agreement with Nigeria, so no certificate of coverage is available.
Do I keep paying UK National Insurance if I work in Nigeria?
Usually for the first 52 weeks, if your employer has a UK place of business and you were UK resident before leaving. After that you can choose voluntary contributions.
Does Nigeria tax a UK employee on a short assignment?
Under the treaty, not if the stay is 183 days or less in the tax year and the pay is neither paid by a Nigerian-resident employer nor borne by a Nigerian permanent establishment.
Does the employee need to pay tax in both countries?
Possibly, but the treaty and UK foreign tax credit relief are designed to stop the same income being taxed twice.
Sources
- HMRC: Guidance on Social Security abroad (NI38), updated 7 Jul 2026 · accessed Oct 2026
- GOV.UK: Voluntary National Insurance, rates · accessed Oct 2026
- HMRC: Guidance note for the Statutory Residence Test (RDR3) · accessed Oct 2026
- GOV.UK: 1987 UK-Nigeria double taxation agreement (in force) · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, individual residence (reviewed 29 May 2026) · accessed Oct 2026
- Mondaq (KPMG Nigeria): Federal Ministry of Interior announces reforms in expatriate administration and visa policy (21 Apr 2025) · 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.