Who Is A “Non-Resident Individual” Now? – Almost No One

On 26 June 2025, four new tax acts were signed into law, with two taking effect from 1 January 2026.  One of the silent but most consequential changes buried in those pages is a clear but broadened legal definition of who a non-resident individual is, for tax purposes in Nigeria.  The way the definition treats ties to Nigeria that are not simply measured in days spent in Nigeria will change how many ordinary people think about work, family, travel, and money.

The New Criterion: Defining the Non-Resident Individual

The Personal Income Tax Act (PITA) previously relied primarily on a 183-day physical presence rule to determine an individual's non-residency, and this was easily circumvented by individuals residing in diaspora. The 2025 Nigeria Tax Act closes this loophole by defining the concept of a non-resident individual.   For a person to qualify as a non‑resident individual, the quality of connection to Nigeria, not merely the number of days spent in the country,  is now put into consideration.  The individual must demonstrate that ties to Nigeria are genuinely minimal.

Under the 2025 Nigeria Tax Act, an individual will be treated as a non-resident individual for personal income tax where, in a year of assessment, such an individual satisfies one or more of the following criteria:

1. Domicile Test: The individual does not consider Nigeria as a permanent home, where main interests lie and where there is an intention to return.
2. Home Test (Permanent Place of Abode): The individual does not have a home available in Nigeria for personal use (such as an apartment or house owned or rented).
3. Habitual Abode Test: The individual does not have a place regularly occupied in Nigeria, even if it is not an owner‑occupied residence.
4. Ties Test (Substantial Connection): The individual does not maintain major economic or immediate family ties in Nigeria (e.g., spouses, parents, siblings, or children do not reside there, and there are no significant business interests).
5. Days Test (Physical Presence): The individual is not physically present in Nigeria for 183 days or more in any 12 months (this count includes annual leave and temporary absences).
6. Diplomat Test: The individual is not serving as a diplomat or diplomatic agent of Nigeria in another country.

The key innovation lies in the “Home test”, “Habitual abode test”, and “Ties test”.  Non-residency is no longer a simple matter of counting days.  If a person’s life is significantly connected to Nigeria through family or property, such a person will likely be considered a tax resident, even where such an individual decides to live abroad for long stretches.

What does being a Non-Resident Individual Mean?

The most significant impact of being classified as a Nigerian non-resident is that only income sourced or deemed to be sourced from Nigeria will be taxable and the final tax payable may, in some cases, be satisfied by tax withheld at source by the customer.  In contrast, a resident individual’s worldwide income becomes subject to Nigerian income tax, as all income earned, accrued, or derived anywhere in the world, be it from employment, business, or investments, will be taxable in Nigeria, subject to relief under unilateral relief of double taxation and any applicable Double Taxation Agreement (DTA).

This shift has a profound impact on three main groups:

1. The Nigerian Diaspora: Many Nigerians who live and work abroad but maintain deep familial, property, and investment ties back home are now squarely in the tax net.  Simply staying below the 183-day count is no longer enough to secure non-resident status.
2. Expatriates and Foreign Assignees: Foreign professionals on short-term assignments who secure long-term accommodation (a permanent place) or whose family are resident in Nigeria may trigger tax residency much sooner than under the old 183-day rule, making their worldwide income taxable in Nigeria.
3. The New Remote Worker: With the rise of the digital economy, an individual working remotely for a foreign company while living in Nigeria for extended periods will be liable for Nigerian income tax on their entire salary, regardless of the foreign source.

How Other Jurisdictions Determine Tax Residency

In determining non-resident status for individuals, the global approach is increasingly anchored on a combination of physical presence and legal or economic ties. While the 183-day rule remains a common benchmark across many jurisdictions, including Nigeria, it is rarely determinative on its own.

In countries such as the UK and France, tax authorities also examine personal and economic connections, including where a spouse or family resides, or whether the individual maintains a home that is available for use. Across OECD and EU jurisdictions, residency is often assessed by asking a broader question: where is the individual’s life truly anchored?

Notably, only two countries, the United States and Eritrea, impose taxation based on citizenship rather than residence.  As a result, a U.S. citizen living and working in Lagos remains a U.S. tax resident, regardless of physical presence elsewhere.

In general, an individual is regarded as non-resident when insufficient time is spent in the country, no permanent home is maintained, personal and economic interests are located elsewhere, or residency is established in another jurisdiction under an applicable tax treaty.

In practice, non-residence is rarely determined by a single factor; it is a balancing exercise of time, ties, and intention.Top of Form

Navigating the New Landscape

The message is clear: non-residency must now be actively demonstrated, not casually assumed.  For individuals whose lives span multiple countries, the era of relying solely on travel patterns is over. What matters now is how clearly such an individual’s personal, economic, and living arrangements demonstrate that Nigeria is not the central anchor of life.

Practical Steps for Those Likely to Be Affected

• Reassess Your Residency Status
  If you spend time in Nigeria, own or rent property here, or maintain close family ties, formally review your residency position for 2026 onward. Many who previously considered themselves non-resident may now be impacted by one or more of the new criteria/tests.
• Be Strategic About Housing
  Housing now carries significant tax implications. Keeping an apartment “just in case” or maintaining a family home that is always available for use may automatically defeat non-resident status. Even serviced apartments, or employer-provided accommodation can qualify as a habitual abode. If your goal is to remain non-resident, carefully evaluate whether maintaining a readily available home in Nigeria aligns with that objective.
• Recognize the Weight of Family Ties
  If your family lives permanently in Nigeria, the law increasingly assumes that your center of vital interest is also in Nigeria, even if your work or income originates abroad. This is especially relevant for diaspora Nigerians who commute internationally while their families remain  at home.
• Remote Workers: Prepare for Full Tax Exposure
  Living in Nigeria while working remotely for a foreign employer does not shield your income from Nigerian tax, once residency is triggered. , location, not payroll, determines tax exposure. Consequently, remote workers should plan early for tax registration and accurate income reporting. 
• Leverage Double Taxation Agreements (DTAs)
  Leveraging a Double Taxation Agreement (DTA) allows you to reduce your overall tax burden by clarifying which country has taxing rights over your income and by applying tie‑breaker rules when your activities span multiple jurisdictions. By identifying the relevant DTA, understanding how its residency and tie‑breaker provisions work, and maintaining proper documentation to support your residence position, you can better manage cross‑border tax exposure. However, while DTAs help relieve double taxation, they do not prevent Nigeria from asserting tax residency, they only resolve conflicts when two countries claim you as a resident. 
• Documentation Is Essential
  From 2026, your residency position must be defensible on paper. Maintain records such as travel logs, lease agreements, utility bills, proof of family residence, and foreign tax residency certificates.

Conclusion

Nigeria’s new tax framework aligns with global best practices and raises the bar.  Non-residency status now has clear criteria and for it to be enjoyed, it must be structured, supported, and continuously reviewed.  For those living across borders, the real question from 2026 is no longer “How many days was I in Nigeria?” It is “Where is the real center of my vital interest?” And the law will be paying close attention to the answer.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.