AuthorBy Jeffrey Cammack
Updated: February 18, 2021
Tax Implications for Nigerian Forex traders Who Reside in Nigeria

Many Nigerian forex traders are not sure what their legal tax obligations are towards the Federal Inland Revenue Service (FIRS). Many trading accounts are overseas, and the gains made from their trading are not visible to FIRS, some traders open trading accounts with forex brokers located in Nigeria, or with brokers who have branches in Nigeria. In this case, these traders’ capital won’t leave the country.

Trader Must Pay Tax On Earnings

In Nigeria, all profits from Forex trading are classified as Capital Gains and are taxed at 10% of the gross. It is a common misperception that traders don’t need to pay income tax on profits made in offshore trading accounts. If a Nigerian resident generates profit from trading in an offshore trading account while residing within the borders of Nigeria, the profit is regarded as normal taxable income and needs to be declared in heir tax returns. In this case, it doesn’t matter where the income originates from, but rather where the person resides while generating that income. 

Business Entities

Forex traders should be aware that Nigerians trading on behalf of someone else must register as Fund/Portfolio Manager with the Securities & Exchange Commission in Nigeria.

 

This article is a general guide only and is not intended as individual legal tax advice. For more specific information on Nigerian tax legislation please consult a registered tax practitioner or the Federal Inland Revenue Service.

Preferred Forex Brokers in Nigeria

Scroll for more detailsPreviousNext
Min. Deposit
Min. Spread
Bonuses
USD 100
0.90 pips
Competitive Bonus
USD 25
0.90 pips
USD 5
0.60 pips
$30 Trading Bonus
USD 5
0 pips
None
USD 100
0.60 pips
None
USD 100
0.10 pips
100% Deposit Bonus On All Amounts

Share your knowledge

Featured Brokers

Trading Forex and CFDs is not suitable for all investors and comes with a high risk of losing money rapidly due to leverage. 75-90% of retail investors lose money trading these products. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Close
>