The Federal Inland Revenue Service (FIRS) has directed landlords and property agents to charge six per cent stamp duty on all tenancy and lease agreements.
FIRS gave the directive in a statement on Wednesday by Director, Communications and Liaison Department Abdullahi Ahmad.
The landlords and property agents, according to Ahmad are to remit such collections to FIRS “so that they do not run foul of the Stamp Duty Act.”
Stamp Duties’ payment is enabled by the Stamp Duty Act (SDA) 1939, as amended by numerous Acts and various resolutions contained in the Laws of the Federation of Nigeria. The SDA also provides a list of documents in its schedule and the duty payable on each.
The Finance Act 2019 states that “the Federal Inland Revenue Service shall be the only competent authority to impose, charge and collect duties upon instruments specified in the Schedule to this Act if such instrument relates to matters executed between a company and an individual, group or body of individuals.”
The total Stamp Duty collection for 2019 was N18 billion.
“Property-related transactions like tenancy or lease agreement fall under the Ad Valorem category of the stamp duty which attracts six per cent duty payable in the percentage of the total value or sum of the tenancy or lease,” Ahmad said.
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