Capital Gains Tax on Investments in Nigeria: What the Law Says in 2026

Nigeria's Capital Gains Tax Act, Cap C1, Laws of the Federation of Nigeria 2004, has existed for decades — yet it remains one of the most misunderstood levies among retail and institutional investors alike. With the Federal Inland Revenue Service (FIRS) ramping up compliance enforcement through its digital tax audit systems in 2025 and 2026, understanding exactly what is chargeable, what is exempt, and how to file correctly is no longer optional.

This guide covers the current legal framework, the treatment of equities, bonds, derivatives, and cryptocurrency, and what changed following the Finance Acts of 2020, 2021, and 2023.

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What Is Capital Gains Tax in Nigeria and Who Must Pay It?

Capital Gains Tax (CGT) is a levy on the profit realised when a chargeable asset is disposed of — whether sold, transferred, gifted, or exchanged. The statutory rate under the Capital Gains Tax Act is 10% of the chargeable gain. This rate has not changed since the original enactment, though the scope of chargeable assets has expanded materially through successive Finance Acts.

CGT applies to:

• Individuals resident in Nigeria, on worldwide gains
• Companies, though most corporate disposals are instead captured under the Companies Income Tax Act (CITA) as income rather than capital
• Non-residents, on assets situated in Nigeria

A gain is calculated as the disposal proceeds minus the allowable cost of acquisition plus permissible incidental costs (legal fees, transfer costs, and improvement expenditure). Inflation indexation is not available under Nigerian law, which means long-held assets are effectively taxed on nominal rather than real gains.

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Which Assets Are Exempt From CGT in Nigeria?

The Capital Gains Tax Act contains several statutory exemptions that are particularly relevant to retail investors:

Nigerian equities listed on the NGX Exchange: Under Section 30 of the CGT Act, as reinforced by the Finance Act 2021, gains arising from the disposal of shares listed on a recognised Nigerian stock exchange are exempt from CGT. This exemption is a deliberate policy choice to encourage participation in the capital market. As of May 2026, the NGX All-Share Index stood at approximately 99,800 points, with market capitalisation exceeding ₦58 trillion, according to NGX data — a market that regulators are reluctant to tax at the point of disposal.

Federal Government bonds and securities: Gains on Nigerian government bonds, including Federal Government of Nigeria (FGN) bonds, treasury bills, and savings bonds issued by the Debt Management Office (DMO), are exempt. State government and local government securities issued under federal law generally receive the same treatment, though investors should confirm the issuing instrument.

Life assurance policies: Gains from the maturity or surrender of life assurance contracts are not chargeable.

Gains of ₦10,000 or less per annum: There is a de minimis exemption for individuals whose aggregate chargeable gains in a tax year do not exceed ₦10,000. Given inflation — the CBN reports consumer price inflation at 31.51% year-on-year as at April 2026 per NBS data — this threshold has become effectively meaningless for most investors, but it remains on the statute books.

Principal private residence: A gain on the disposal of a dwelling house that is the taxpayer's principal residence is exempt, subject to conditions around occupation.

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How Does CGT Apply to Crypto, Unlisted Shares, and Offshore Assets?

This is where most Nigerian investors face genuine exposure — and where FIRS scrutiny has increased most sharply.

Cryptocurrency: The Finance Act 2023 formally brought digital assets into the Nigerian tax net. Gains from disposing of cryptocurrency — selling, swapping one token for another, or using crypto to purchase goods and services — are treated as chargeable gains under the CGT framework at 10%. The FIRS issued guidance notes in late 2023 confirming that peer-to-peer (P2P) trades on platforms accessible to Nigerian users are captured. The CBN's partial reversal on crypto banking restrictions in December 2023, allowing licensed fintechs to operate virtual asset accounts, further brought these transactions into regulated financial infrastructure where reporting becomes easier for FIRS to enforce.

For reference: Bitcoin traded at approximately $97,400 (₦154 million at the prevailing NAFEM rate of ₦1,580 per dollar as at early June 2026) per CoinGecko data. Investors who purchased at lower naira valuations in prior years are sitting on substantial nominal gains. At 10% CGT on disposal, the tax liability on a single position can be significant.

Unlisted (private) company shares: These do not benefit from the NGX exemption. The disposal of shares in private limited companies — including startup equity, ESOP exercises, and secondary sales — is a chargeable event. Valuation is often the practical difficulty: FIRS guidance requires an arm's-length valuation, and the burden of proof rests with the taxpayer.

Offshore equities and ETFs: Nigerian residents who hold stocks listed on the NYSE, LSE, or other foreign exchanges through investment platforms are liable for CGT on gains arising from disposal. The CGT Act taxes residents on worldwide gains. The practical enforcement mechanism has historically been limited, but FIRS's participation in automatic exchange of information frameworks under the OECD Common Reporting Standard (CRS) — which Nigeria signed — is progressively closing that gap.

Derivatives and futures: There is no explicit statutory exemption for derivatives. FIRS treats gains on contracts for difference (CFDs), options, and futures as chargeable gains where the underlying is a capital asset. Where a derivative is settled in cash with no transfer of the underlying asset, the tax treatment is less settled, but FIRS has indicated it applies CGT by analogy to the underlying asset class.

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How Do You File CGT With FIRS in 2026?

CGT is self-assessed in Nigeria. The filing obligations are as follows:

Individuals must declare chargeable gains in their annual personal income tax return (Form A) filed with the relevant State Internal Revenue Service for employment income — but CGT is a federal tax collected by FIRS. In practice, individuals with capital gains file a standalone CGT return with FIRS and pay via the FIRS e-tax portal (etax.firs.gov.ng).

The filing deadline mirrors the income tax cycle: returns and payment are due by 31 March of the year following the tax year in which the disposal occurred. A tax year runs from 1 January to 31 December.

Penalties for late filing include a ₦25,000 flat fee for initial default, plus ₦5,000 for each subsequent month of non-compliance, as set under the FIRS Establishment Act. FIRS also charges interest on unpaid tax at the CBN monetary policy rate plus 10 percentage points — with the MPR currently at 26.50% as of June 2026 per CBN data, that implies an effective interest charge of 36.50% per annum on overdue CGT, which is punishing.

Records to retain: acquisition contracts, brokerage statements, wallet transaction histories, valuation reports for private shares, and any correspondence confirming transfer costs. FIRS may demand these going back six years.

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Practical Steps for Nigerian Investors

Nigerian investors with diversified portfolios should take the following steps before the next filing cycle:

1. Segregate exempt and chargeable assets. NGX-listed equities and FGN bonds are exempt. Everything else — crypto, private shares, offshore stocks — is potentially chargeable.
2. Record cost basis in naira at the date of acquisition. This is the figure that determines your gain. For crypto bought in prior years when the naira was stronger, the naira-denominated cost basis may be lower than investors expect.
3. Document P2P trades. Screenshot transaction histories. FIRS has flagged P2P activity as an area of audit focus.
4. Consult a registered tax adviser for portfolio-level CGT planning, particularly around the timing of disposals across tax years.

For a broader overview of how FIRS taxes investment income including dividends, interest, and rental yields, see the full guide on FIRS tax on investment income.

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Regulatory note: This article is prepared for informational purposes only. It references the Capital Gains Tax Act (Cap C1 LFN 2004), Finance Acts 2020, 2021, and 2023, FIRS guidance notes, and CBN and NBS published data as at June 2026. Tax law is subject to change, and individual circumstances vary. Readers should seek independent professional advice before making filing or investment decisions. The Cowrie is an independent editorial publication. It does not hold a financial services licence, investment adviser registration, or tax practitioner licence issued by FIRS, the SEC, or any Nigerian regulatory authority. Nothing in this article constitutes tax advice, legal advice, or a solicitation to buy or sell any financial instrument.