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The short answer
If you live and work in the UK, pay for that work is taxable in the UK even when a Nigerian employer pays it in naira. Under the UK–Nigeria treaty, employment income is taxed where you live unless the work is done in the other country, so work done at a desk in the UK falls to the UK. A Nigerian employer with no UK branch or office is generally outside PAYE, so the tax is usually reported through Self Assessment.
Plenty of Nigerians moved to the UK and kept their Lagos job, working from home in Leeds or London on Nigerian hours and a naira payslip. It feels like Nigerian income. For UK tax, where the work is physically done matters more than where the employer is. This guide explains the rules and the reporting. It is information, not tax advice.
Why the UK can tax it
GOV.UK says UK residents normally pay UK tax on all their income, whether from the UK or abroad. Article 15 of the 1987 UK–Nigeria treaty adds that pay for employment is taxable only in the country where the employee is resident unless the work is carried out in the other country. If you are UK resident and the work is done in the UK, Nigeria has no treaty right to tax it.
Nigeria's own rules point the same way for non-residents: NiDCOM's 2026 diaspora guide says income for services physically performed outside Nigeria is not taxable in Nigeria unless you are Nigerian resident. If your family or home ties keep you Nigerian resident too, the treaty's tie-breaker applies; see the statutory residence test for the UK side.
Why your employer probably is not running PAYE
HMRC's PAYE Manual says an employer must have a UK presence to fall within PAYE. PAYE81610 explains that a UK branch, agency or representative office creates that presence, but employees working from their own homes in the UK do not, and nor does using UK banks or lawyers. So a Lagos company paying you in naira is usually not required to run UK payroll.
There are exceptions. PAYE81511 says that if a UK entity you work for is not your employer but the actual employer is outside PAYE, the UK entity may have to operate PAYE instead. An overseas employer can also choose to run PAYE voluntarily. Ask your employer which applies.
Reporting it yourself
- Register for Self Assessment by 5 October after the end of the tax year in which the income started; our registration guide covers the dates.
- Report the pay as employment income, converted to pounds. HMRC publishes monthly and average exchange rates; see which exchange rate to use.
- File online by 31 January after the tax year and pay by the same date. GOV.UK lists a second payment on account date of 31 July.
- If Nigerian PAYE was deducted, see below.
If Nigerian PAYE is still being deducted
Many employers keep deducting Nigerian PAYE because nobody told payroll you moved. If you are non-resident in Nigeria and do the work in the UK, that tax may not be due in Nigeria at all. UK credit for foreign tax is limited to tax properly due under the treaty, so the usual route for tax deducted in error is a refund claim in Nigeria. Tell your employer and ask the Nigerian tax office about a refund; do not assume a UK credit will cover it. Our guide to foreign tax credit relief explains the limits.
Worked example
Example, with an illustrative rate of ₦2,000 to £1. Chidi works from Manchester for a Lagos firm on ₦60,000,000 a year for the 2026 to 2027 UK tax year, with no other income.
| Step | Amount |
|---|---|
| Salary in pounds at the example rate | £30,000 |
| Personal Allowance 2026 to 2027 | £12,570 |
| Taxable at 20% basic rate | £17,430 |
| UK income tax | £3,486 |
GOV.UK lists the 2026 to 2027 Personal Allowance at £12,570 and the basic rate at 20% up to £50,270. National Insurance on pay from an overseas employer follows separate rules not covered in the pages we read; ask HMRC. Exchange rates move, so the pound figure here is only an illustration.
Work trips to Nigeria
Article 15 cuts the other way when you fly home to work. Days you physically work in Nigeria are work exercised in Nigeria, so Nigeria may tax the pay for those days. The treaty exempts it in Nigeria only if all three conditions are met: you are there for no more than 183 days in the tax year, the employer is not resident in Nigeria, and the pay is not borne by a Nigerian branch. A Lagos employer is resident in Nigeria, so that exemption will not usually help. Keep a log of working days in each country; it decides how the pay is split.
The UK still taxes the whole salary if you are UK resident, with credit for any Nigerian tax properly due on the Nigerian working days, up to the UK tax on that slice.
Two other points
- Check your UK visa conditions allow the work you do; this guide covers tax only.
- Keep payslips, contracts and a record of where you worked each day.
Where Pryme fits
A Pryme account opened in the UK can receive your naira salary and hold it alongside pounds. Swap converts when you choose, with the rate and the fee shown first, and statements give you a clean record of each payment for your return. See multicurrency accounts.
Questions people ask
Do I pay UK tax on a Nigerian salary if I work remotely from the UK?
Generally yes, if you are UK resident and do the work in the UK. The treaty gives the UK the right to tax pay for work done here.
Does my Nigerian employer have to run UK PAYE?
Usually not, unless it has a UK branch, agency or office. Staff working from home in the UK do not create a UK presence, according to HMRC's PAYE Manual.
Should Nigeria still deduct PAYE from my salary?
If you are non-resident in Nigeria and work outside Nigeria, NiDCOM's guide says that income is not taxable in Nigeria. Tell your employer and ask about a refund of tax wrongly deducted.
How do I report a naira salary to HMRC?
Register for Self Assessment, report it as employment income converted to pounds, and file by 31 January after the tax year.
Sources
- GOV.UK: Tax on foreign income, residence (updated 1 Oct 2026) · accessed Oct 2026
- UK–Nigeria Double Taxation Convention 1987 (GOV.UK PDF) · accessed Oct 2026
- HMRC PAYE Manual PAYE81610: employers' presence in UK · accessed Oct 2026
- HMRC PAYE Manual PAYE81511: employer with no UK presence (updated 2 Oct 2026) · accessed Oct 2026
- NiDCOM / NGEX: Diaspora guide to Nigeria's tax reforms 2026 (Jan 2026) · accessed Oct 2026
- GOV.UK: Income Tax rates and Personal Allowances · 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.