Amid the rising economic effects of the coronavirus global pandemic, the Federal Inland Revenue Service (FIRS) has declared that landlords and property agents must charge 6 per cent Stamp Duty on all tenancy and lease agreements they enter into with all renters and remit same promptly to the Service.
Compliance to this directive will ensure that they do not run foul of the Stamp Duty Act.
NEWS FLAKES NG reports that the clarification according to the agency became necessary following the recent release and wide circulation of a stamp duty clarification guide by Executive Chairman, FIRS, Mr Muhammad Nami.
According to Nami, 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 the 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 the agreement, whom the Stamp Duty Act identified as the tenant or renter and the responsibility of collection and remittance fall 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, FIRS, Abdullahi Ismaila Ahmad.
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Mr 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, 1.5 per cent; Certificate of Occupancy, Partnership N1,000 flat rate; Gift of Land, 1.5 per cent; Legal Mortgage, 0.375 per cent; Legal Mortgage (Upstamping), 0.375 per cent; Deed of Conveyance or Transfer on Sale of Property, 1.5 per cent; Gift of Land, 1.5 per cent; Memorandum of Understanding (Related to Land, Sales, Joint Venture, Surrender, Subdivision Agreements, 1.5 per cent; Power of Attorney (Irrevocable/Land Related), 1.5 per cent; and Sales Agreement, 1.5 per cent," the statement added.
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