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Nigeria NRIs · Rental Income Tax

Rental income tax for NRIs in Nigeria

Your tenant must deduct tax on the gross rent, and no India-Nigeria treaty exists to cap it. Two India-side moves bring it back down.

Rent from Indian property is taxed in India whatever passport you carry, because the building is here (Section 9(1)(i)). India and Nigeria never signed a tax treaty, so there is no treaty rate to bring anything down to. On rent, that absence costs you almost nothing, since treaties leave property income taxable where the property stands. The bite is the withholding: your tenant must deduct under Section 393(2) (Section 195 until 31 March 2026) at 31.2% on the gross rent, not under the lighter resident-landlord rule, and gross rent is far more than you're actually taxed on. Two India-side moves fix it. A Form 128 certificate cuts the monthly deduction at source, and your annual return reclaims what has already gone.
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India-Nigeria key facts: rental income tax

India's default non-resident rate of 31.2% applies here with nothing to claim it down to.

A Form 128 certificate and the 30% deduction are the levers. A residence certificate from the Nigeria Revenue Service (NRS, formerly FIRS) is worth having for the Nigeria side, where your own domestic relief rules are the only thing that can soften the Indian tax.

This is India's domestic withholding under Section 393(2) (Section 195 until 31 March 2026). There is no India-Nigeria treaty to modify it. Surcharge applies on top; the 4% cess is already included in this figure.

How it works on the India side

A tenant paying rent to an NRI landlord must deduct TDS under Section 393(2) (Section 195 until 31 March 2026), the provision for any payment to a non-resident, which means the tenant has to take a TAN, deduct each month on the gross rent, deposit it, file a quarterly Form 144 (the old Form 27Q) against your PAN, and issue you a TDS certificate. The common, costly mistake is the tenant using Section 194-IB, the 2% resident-landlord rule, which doesn't apply to a non-resident landlord and leaves both sides exposed.

The deduction on gross rent is more than you actually owe, because your taxable rental income is much smaller: a flat 30% standard deduction comes off under Section 24(a), and home-loan interest comes off too. When you file your return, the TDS the tenant deposited is set against your real liability and the excess is refunded, but only if the tenant's quarterly statement correctly reports it against your PAN, which is why setting the tenant up right from the start matters. If you'd rather not wait a year for that refund, a lower-deduction certificate on Form 128 under Section 395 (the old Form 13 under Section 197) can cut the monthly deduction at source instead.

What changes because you live in Nigeria

Nigeria taxes your Indian income and gains too, and on some of it a remittance rule cancels the Nigerian tax. Section 12 of the Nigeria Tax Act 2025, in force since 1 January 2026, makes a resident's income and gains chargeable wherever they arise, even if the cash never leaves your NRO account. The relief runs backwards: section 163 exempts foreign dividend, interest, rent and royalty, but only if you bring it into Nigeria through approved channels. Leave it parked in India and the exemption goes, and section 120 then credits the Indian tax you paid, capped at the Nigerian tax on it. That remittance route never covers gains, so an Indian flat or share sale is chargeable under section 34 wherever the asset sits, and the N150 million threshold only shelters shares in a Nigerian company. Section 51 exempts one dwelling-house once in your life, and a flat you rent out rarely qualifies.

Frequently asked questions

Common questions from Nigerian Indians

Under Section 393(2), the successor to Section 195, because you're a non-resident landlord. The tenant has to take a TAN, deduct on the gross rent at the 31.2% non-resident rate, deposit it, file a quarterly Form 144 (the old Form 27Q) against your PAN and give you the TDS certificate. Section 194-IB, the 2% rule most tenants know (it was 5% until 1 October 2024), applies only to resident landlords and is the wrong provision for a non-resident.

Yes. The deduction is on the gross rent, but your taxable rental income is much smaller, because you get a flat 30% standard deduction under Section 24(a) plus any home-loan interest before tax is computed. The over-deducted amount comes back as a refund when you file your Indian return, provided the tenant's quarterly statement correctly reports the TDS against your PAN. Nigerian Indians who don't want to wait for that refund apply for a Form 128 certificate instead.

There is no India-Nigeria treaty, and on rent that makes no practical difference, because India's treaties leave income from Indian property taxable in India too. Where Nigeria taxes the rent too, ask what credit its own rules give for the Indian tax, because no treaty compels one. The note below says when it applies. Your saving comes from the 30% standard deduction, the home-loan interest, and a certificate that stops the over-deduction at source rather than chasing it a year later.

Go further

Read the full guide, or see your country's complete picture

NRI landlord: setting your tenant up for Section 195 TDSNigeria NRI tax guide: every income type and the rates that apply

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