The Chairman of the Federal Inland Revenue Service, FIRS, Muhammad Nami has said that the Stamp Duty on Tenancy is charged on a graduated rate, where some Nigerians will get to pay as low as N780.
Nami explained that if your rent is from 1-7 years, the Stamp Duty payable is 0.78%. This is not up to 1%. The implication is that if your rent is N100,000 per annum, the stamp duty due at 0.78% is just N780.
He said, “The second category is for the tenant whose agreement is above 7 years and up to 21 years, the Stamp Duty chargeable is 3%. Such a person is not going to pay rent for a long time, so 3% is deducted to provide social amenities and fund infrastructure.
“There are also people who would comfortably pay rent for above 21 years; such people will not go back to their landlords to pay rent again. Therefore, the law states that such people should pay 6% of the rent as Stamp duty.”
Tenement rate is a pre-determined fee/tax charged and collected by a local government authority on a developed and occupied property.
It is expected to be paid by the occupier of a property within a given time, in the case of a rented apartment, it is the tenant that should pay.
The government had previously announced that local government will begin the collection of tenement rates, a decision that was widely condemned by Nigerians.