How to invest in US stocks from Nigeria under CBN and SEC rules

Placing an order for a New York-listed share from Lagos or Abuja takes a few taps. The harder questions are about the money behind the order: which dollars you are allowed to use, who may legally sell you foreign shares, how much of each dividend the IRS keeps, and what Nigeria taxes after the 2025 reforms. This guide works through those rules for Nigerian residents with the figures in force in November 2026. Nigerian law decides what you may do and how it is taxed, so use this as a map and confirm your own position with the CBN, the SEC and a Nigerian tax professional. The guide to investing from abroad covers the parts that apply in every country.

Can Nigerians legally buy US shares?

Yes. Nigerian residents can own US-listed shares and ETFs, but the CBN regulates the dollars you pay with and the SEC regulates who may sell foreign securities to you.

Three routes exist in practice, and each sits differently with the regulators:

• A foreign broker that accepts Nigerian clients. You open the account online and the shares are held abroad. In April 2021 the SEC said that only foreign securities listed on an exchange registered in Nigeria may be offered to the Nigerian public, and it warned against unregistered online platforms giving access to foreign markets. Using such a firm is your own decision, and Nigerian investor protection does not follow you there.
• An SEC-registered Nigerian broker working through a foreign partner. On July 2, 2026 the SEC published draft rules for this model. A broker would need a No Objection from the Commission and net liquid capital of at least ₦2 billion. Client shares would sit with a regulated foreign custodian, segregated from the broker's own assets, and settlement would run from bank to broker, with unregulated fintech wallets banned. Brokers would report quarterly and collect a fee of 0.35% on every foreign purchase. When this guide was written these were proposals for comment, not final rules.
• Funds sold in Nigeria. Some SEC-registered funds are priced in dollars, but a dollar fund is not the same as a US equity fund. Many hold Nigerian Eurobonds, so read the prospectus to see what the fund owns.

Whichever route you pick, check the firm's status with the SEC and ask which legal entity holds your shares. The checklist in how to choose a brokerage account applies here too, with one addition: find out where dividend cash is held and how you withdraw it.

Where can the dollars come from under CBN rules?

From dollars you already hold, such as an ordinary domiciliary account balance, because the CBN says funds sourced from the official market cannot buy foreign-currency securities.

That official market is the Nigerian Foreign Exchange Market (NFEM). On June 14, 2023 the CBN folded its separate exchange windows into one market run on a willing-buyer, willing-seller basis, and the rate that emerged was far weaker than before. The CBN's Financial Stability Report records the official rate opening 2023 at ₦461 per dollar and closing June at ₦769.25.

The fourth edition of the CBN's Foreign Exchange Manual, issued in 2026, keeps two rules that matter for investors:

• NFEM dollars are off limits. Memorandum 18 says funds sourced from the NFEM cannot be used to purchase foreign-currency securities or to establish entities abroad. A bank will not sell you official-market dollars to fund a brokerage account.
• Ordinary domiciliary balances are yours to move. Memorandum 20 gives holders of ordinary domiciliary accounts unfettered and unrestricted access to their funds and lets them send cash deposits of up to US$10,000 a day by telegraphic transfer. It also says Form A is not mandatory for remittances from these accounts, although the bank records a purpose code for each one.

In practice, dollars that reach your domiciliary account from abroad, as cash deposits or as proceeds of earlier investments can fund a foreign brokerage account. Export-proceeds domiciliary accounts are different, because their funds are reserved for documented eligible transactions. Anti-money-laundering checks apply to every transfer, so expect questions about large or unusual ones, and ask your bank how it will code an investment transfer before you send it. If you earn dollars abroad, the guide to holding US dollars abroad compares keeping them offshore with bringing them home.

How much does the US withhold without a tax treaty?

The full 30%: Nigeria has no income tax treaty with the United States, so dividends from US shares and US-domiciled ETFs lose 30% at source.

The default rule is 30% on US-source dividends, unless a tax treaty sets a lower rate, and no treaty applies to Nigerian residents. Your broker deducts the tax before the dividend reaches your account, and there is nothing to reclaim afterwards.

You should still file Form W-8BEN. It certifies that you are not a US person, which keeps the broker from treating the account as undocumented, and it is what makes the interest exemptions work. It stays valid until the last day of the third calendar year after the year it is signed. The W-8BEN guide explains each line of the form.

Three kinds of holding escape the 30%:

• Capital gains. The US generally leaves a nonresident's share gains untaxed unless you were in the country for 183 days or more during the tax year or the gain is tied to a US business.
• Treasury interest. Interest on Treasury bills, notes and bonds usually qualifies for the portfolio interest exemption; the guide to buying US Treasury bills from abroad sets out the conditions.
• Irish-domiciled funds. An Irish ETF tracking US shares pays 15% on US dividends inside the fund under the US-Ireland treaty, and Ireland generally does not withhold on the fund's distributions. The comparison of US vs Irish-domiciled ETFs covers the trade-offs, such as wider spreads and fewer fund choices.

For a Nigerian investor, the fund's domicile is the largest tax lever available: it halves the US tax on dividends every year the fund is held. The saving is cleanest when the distributions come home through approved channels and are exempt, because Nigerian tax on dividends left abroad gets no credit for US tax paid inside the fund.

Nigerian tax on foreign income after the 2025 reform

The Nigeria Tax Act 2025 took effect on January 1, 2026 and taxes residents on worldwide income. It treats foreign investment income in two different ways, depending on where the money ends up.

Dividends and interest you bring home. Section 162(1)(s) exempts dividends, interest, rent and royalties earned outside Nigeria if they are brought into Nigeria through approved channels. The act does not define approved channels. Receiving the money through a Nigerian bank is the natural reading, but keep statements that tie each inflow to the dividend it came from, and get advice before relying on the exemption.

Dividends left abroad. Dividends that stay in the brokerage account are taxable at personal income tax rates. The act gives unilateral relief for foreign tax, capped at the lower of the Nigerian tax on that income and the foreign tax paid. Because the US already takes 30% and the top Nigerian rate is 25%, the credit normally covers all of the Nigerian tax on US dividends.

Gains on US shares. Gains on disposals are chargeable at the same personal income tax rates. The relief for share disposals, which covers proceeds under ₦150 million a year with gains of up to ₦10 million, applies to shares in Nigerian companies, so it does not shelter US shares. The US does not tax these gains, which leaves no foreign tax to credit, so the Nigerian tax applies in full.

The Fourth Schedule bands start at 0% on the first ₦800,000 of taxable income, then step through 15%, 18%, 21% and 23% on successive bands, reaching 25% above ₦50 million.

Each taxable person files an annual return by March 31 for the previous year with the internal revenue service of the state where they live. The Nigeria Revenue Service replaced the Federal Inland Revenue Service under the reforms, but individuals still deal mainly with their state. Because the law is new and some terms remain undefined, a Nigerian tax professional is worth paying for in the first year you report foreign holdings.

What US estate tax applies to Nigerian investors?

Once your US shares and US-domiciled funds pass $60,000 at death, the US can levy estate tax at up to 40%, and no treaty reduces it for Nigerians.

The filing threshold is $60,000 of US-situated assets, and nonresidents get a unified credit of $13,000, which offsets the tax on the first $60,000 of US assets. Above that line the tax rises quickly, because the rate schedule reaches 30% at $100,000. US bank deposits that are not tied to a US business, Treasury holdings whose interest qualifies for the portfolio interest exemption and Irish-domiciled ETFs generally fall outside the US estate.

Time is a cost too. A US broker usually waits for an IRS transfer certificate before releasing a dead client's shares, so heirs can be shut out for months. The estate tax guide for nonresidents walks through Form 706-NA, and a written list of your accounts saves your family a search.

Nigeria's rules for US shares in one table

What does the naira do to a dollar return?

It can outweigh it: when the naira weakens, your US holdings are worth more in naira, and when it strengthens, a dollar gain can shrink or disappear.

The mid-market rate as this page updates is 1 USD = 1,348.45 NGN (Nov 2, 2026). Banks and platforms sell dollars at a margin above that rate, and that margin is often the largest cost of investing abroad. The table shows what common naira sums buy at the mid-market rate and after a 1% or 3% markup.

The exposure runs both ways. Suppose you bought $10,000 of an ETF when a dollar cost ₦1,500, so the position cost ₦15 million. If the ETF is flat and the naira strengthens to ₦1,350, the holding is worth ₦13.5 million, a 10% loss in naira. If the naira weakens to ₦1,650 instead, it is worth ₦16.5 million. These rates are illustrations, not forecasts.

Compare every quote with the mid-market exchange rate, see how exchange-rate markups are built, and check a conversion in the currency converter before you move money. The guide to currency risk on US assets covers time horizons and hedging.

Worked example: $10,000 in a US index ETF

Selling looks different. If the ETF rises to $13,000 and you sell, the US takes nothing, but Nigeria taxes the gain at your marginal rate. With the naira unchanged at ₦1,500, the $3,000 gain is ₦4.5 million, and at the 25% top rate the tax is ₦1.125 million. A weaker naira by the sale date would raise the naira gain, and the tax with it. The SPY data page tracks the price and payouts of one large S&P 500 fund, and dividend investing basics explains how yield is measured.

Risks Nigerian investors should weigh

• Platform risk. The SEC has warned repeatedly about unregistered platforms selling access to foreign shares. If such a firm fails or freezes your account, Nigerian regulators may be unable to help, so check its registration, its legal entity and its custodian, and read up on common money transfer scams.
• Policy risk. Foreign exchange rules have changed several times since 2023, and the SEC's cross-border rules are still being finalised. A route that works today may need new paperwork next year.
• Tax uncertainty. The 2025 act is in its first year, and the meaning of approved channels has not been defined. Guidance could change how your dividends or gains are treated.
• Currency risk. A stronger naira cuts the naira value of your holdings, and a sharp move can outweigh several years of returns.
• Estate risk. Above $60,000 the US estate tax applies, and even below it heirs need paperwork the broker accepts. Families sometimes never learn an account exists.
• Cost risk. Exchange-rate margins, transfer charges and the proposed SEC fee weigh most on small, frequent purchases, so fewer, larger transfers usually cost less.

Before sending money, write down where the dollars come from, which firm will hold the shares and who regulates it, the fund's domicile and where you will keep your records. Local rules decide what is allowed and how it is taxed, so check the current CBN manual, SEC notices and the Nigeria Tax Act, or ask a Nigerian tax professional to review your plan.