Everything you need to know about moving profits, dividends, and capital out of Nigeria without hassle.
What is Capital Repatriation? (The Essentials You Need to Understand)
Capital repatriation is the process of transferring funds or profits made in Nigeria back to the investor’s home country. For foreign investors, repatriating capital is a key consideration when planning their investment strategies in Nigeria.
Why Capital Repatriation Matters
Foreign investors typically invest in Nigeria to make a profit. After running their businesses, they need to move their earnings (profits, dividends, and capital) back home. This ensures they can reinvest or use their earnings as they see fit. The ability to repatriate capital is one of the major factors that can either encourage or discourage foreign investments in a country.
The Legal Framework
Capital repatriation in Nigeria is governed by the Central Bank of Nigeria (CBN) and the Federal Inland Revenue Service (FIRS). These agencies have set regulations to ensure that foreign investors can legally move their capital while adhering to tax obligations.
Who Can Repatriate Capital from Nigeria?
Not all businesses or individuals are eligible for capital repatriation. Generally, foreign investors, whether individual or corporate, who meet certain requirements can repatriate their earnings from Nigeria.
- Foreign-Owned Businesses: If your business is 100% foreign-owned and has been duly registered with the Corporate Affairs Commission (CAC), you can repatriate your profits.
- Joint Ventures: Foreign investors in joint ventures with Nigerian companies can also repatriate their share of the profits, provided the conditions are met.
- Non-Resident Investors: If you’re a non-resident investor (someone who lives abroad but owns or has an interest in Nigerian assets), you’re entitled to repatriate earnings from your Nigerian investments.
Legal Requirements for Capital Repatriation (Getting It Right the First Time)
To avoid unnecessary delays or legal challenges, foreign investors must adhere to the following regulations:
Key Documents You’ll Need
- Capital Importation Certificate (CIC): This is a mandatory document that foreign investors must acquire to prove the legitimacy of their capital. Without the CIC, repatriating your funds may be impossible.
- Tax Clearance: Before repatriating capital, you must have cleared your tax obligations with the Federal Inland Revenue Service (FIRS). This ensures that any applicable taxes on profits or dividends have been paid.
- Bank Authorization: You’ll need to work through an authorized dealer (usually a commercial bank) to process your repatriation request. The bank will ensure your funds are transferred in compliance with Nigerian regulations.
CBN Regulations
The Central Bank of Nigeria has set up specific guidelines for capital repatriation, including the approval process for CIC and required reporting on foreign exchange transactions.
Step-by-Step Guide to Repatriating Capital from Nigeria
Repatriating your capital can seem like a daunting task, but with the right steps, it’s manageable. Here’s a simple breakdown:
Step 1: Verify Your Company’s Profitability and Eligibility
Before you start, ensure that your business is legally compliant, and verify that your company is profitable. A non-profitable business can’t repatriate capital.
Step 2: Complete the Necessary Documentation
Gather your documents, including:
- Proof of capital importation
- Tax clearance from FIRS
- Bank account details
- Copies of company registration documents
Step 3: Apply for Capital Importation Certificate (CIC)
To get your CIC, submit your application through your authorized dealer. The certificate is crucial for the repatriation process, confirming that the funds you want to move are legitimate.
Step 4: Submit Your Application to the Bank and Get Approval
Once your CIC is approved, submit your repatriation application through an authorized dealer. This process involves filling out forms and confirming your payment details.
Step 5: Repatriate Funds via Authorized Dealers (Commercial Banks)
Once everything is in place, the bank will transfer your funds to your designated foreign account. Depending on the bank’s processes, this could take several days.
Capital Repatriation Taxes and Fees (2025 Update)
Foreign investors must be aware of the taxes and fees involved when repatriating capital from Nigeria. While the CBN and FIRS facilitate the process, investors must adhere to tax obligations.
Taxes on Profits, Dividends, and Capital Gains
- Profit Tax: You will need to pay tax on profits before repatriation. The current corporate tax rate for foreign investors is generally 30% (subject to certain exemptions).
- Dividend Tax: Dividend payments are subject to a 10% withholding tax for foreign investors in Nigeria.
- Capital Gains Tax: If your repatriation involves selling Nigerian assets, the capital gains tax will apply, depending on the value of the sale.
Bank and Regulatory Fees
You may also incur processing fees from your bank or other financial intermediaries who assist with the repatriation. These fees vary from bank to bank.
Common Mistakes to Avoid in Capital Repatriation
To ensure a smooth repatriation process, avoid these common mistakes:
- Not Maintaining Proper Documentation: One of the most common errors is failing to keep accurate records of capital importation or missing key documents like the CIC. This can lead to delays.
- Overlooking Tax Obligations: Many foreign investors forget to settle taxes before repatriating funds, which can result in penalties or a delayed approval process.
- Ignoring CBN Guidelines: Failing to adhere to CBN’s repatriation regulations can result in rejection of your application or delayed transfers.
FAQs About Capital Repatriation in Nigeria
Can I Repatriate 100% of My Profits?
Yes, you can repatriate 100% of your profits, provided you have cleared all your taxes and met the necessary requirements.
How Long Does It Take to Repatriate Capital?
The repatriation process usually takes anywhere from a few days to a couple of weeks, depending on your bank and the completeness of your documentation.
Are There Limits on the Amount of Capital I Can Send Out?
No, there are no limits on the amount of capital you can repatriate, as long as you meet the regulatory and tax requirements.
What Happens if My Capital Repatriation Request is Denied?
If your request is denied, you can appeal the decision by providing additional documentation or correcting any errors in your submission. Consulting a legal expert might be necessary.
Stay On Top of Your Investment (Expert Assistance with Capital Repatriation)
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