FIRS clarifies stamp duty charges, lists eligible transactions

FIRS clarifies stamp duty charges, lists eligible transactions.

FIRS clarifies stamp duty charges, lists eligible transactions

A comprehensive information to guide taxpayers and the general public on rates payable as stamp duty charges, has now been made available by the Federal Inland Revenue Service (FIRS)

In a public statement on Tuesday July 21, 2020 by the Director Communications and liaison Department of the FIRS, Abdullahi Ahmad, this was revealed.

Mr. Ahmad said the clarification became imperative in view of several requests by taxpayers who want to know about the current administration of Stamp Duties Act in the country.

He stated that the clarification guide was contained in a Public Notice signed by Executive Chairman of FIRS, Mr Muhammad Nami, and was published on the official website of FIRS,

The executive chairman was quoted as saying,“stamp duty is a tax payable in respect of dutiable instrument as provided under the Stamp Duties Act, CAP S8, LFN 2004 (as amended).

“Such instruments include Agreements, Contracts, Receipts, Memorandum of Understanding (MOU), Promissory notes, Insurance policies and others stipulated in the Schedule to the Stamp Duties Act.

“Stamp Duty is chargeable on both physical and electronic instruments in two ways i.e. Ad-valorem, where duty payable is a percentage of the consideration on an instrument; or Flat Rate, where a fixed sum is chargeable irrespective of the consideration on dutiable instrument or document.”

Nami further listed at least 50 types of transactions that are eligible for stamp duty deductions.

Some of the listed chargeable transactions include bank deposit or transfer, loan agreement, Memorandum of Understanding (MoU) related to land, sales agreement, will, tenancy/lease agreement and all receipts.
The FIRS boss while making the clarification noted that the recently inaugurated FIRS Adhesive Stamp was not the same as postage stamp which is administered by NIPOST for the purposes of delivery of items and documents.

The executive chairman said, “The burden of payment of stamp duties whether fixed or ad-valorem is that of the beneficiaries of a contract, or Money Deposit Banks’ customers who transfer an amount of N10,000 and above from his account to another customer’s account.

“It is the responsibility of Ministries, Departments and Agencies (MDAs), Money Deposit Banks (MDBs), Companies, Landlords, Executors, among others to ensure that service providers, contractors and tenants pay stamp duties due on agreements, receipts and other dutiable instruments

“Failure to deduct or remit stamp duties into the Federal or State Stamp Duties Account attracts relevant penalties and interest as stipulated in the Stamp Duties Act, Cap S8, LFN 2004 (as amended).”

Author: abokimallamfx