To grow the nation’s non-oil revenue base, the Federal Inland Revenue Service (FIRS) has tasked landlords and property agents to ensure they charge 6 per cent Stamp Duty on all tenancy and lease agreements they enter into with renters and remit same promptly to the Service to avoid breaching the Stamp Duty Act.
The charge followed the recent release and wide circulation of a stamp duty clarification guide by Executive Chairman, FIRS, Mr. Muhammad Nami. According to him, property-related transactions like tenancy or lease agreement fall under the Ad Valorem category of the stamp duty which attracts 6 per cent duty payable in percentage of the total value or sum of the tenancy or lease.
The burden of payment of the 6 per cent lies on the beneficiary of the tenancy or lease agreement, whom the Stamp Duty Act identifies as the tenant or renter and the responsibility of collection and remittance falls on the landlord or agent in charge of the property for lease or rent, according to a statement issued on Wednesday by Director, Communications and Liaison Department at FIRS, Abdullahi Ismaila Ahmad.
Nami stressed that “in any case, the party making the payment shall have the obligation to account for the applicable stamp duties.”
Some other Stamp Duty types and their rates are Appraisement or Valuation of Property, 1.5per cent; Certificate of Occupancy, Partnership N1,000 flat rate; Gift of Land, 1.5per cent; Legal Mortgage, 0.375per cent; Legal Mortgage (Upstamping), 0.375per cent; Deed of Conveyance or Transfer on Sale of Property, 1.5per cent; Gift of Land, 1.5per cent; Memorandum of Understanding (Related to Land, Sales, Joint Venture, Surrender, Subdivision Agreements, 1.5per cent; Power of Attorney (Irrevocable/Land Related), 1.5per cent; and Sales Agreement, 1.5per cent.