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In this article, I will be looking at three categories of tenants based on their pattern of paying rent and how this reflects how much they are to pay on stamp duty on their tenancy.

Categories of tenancies based on rent payment:


Generally, the Stamp Duty on Tenancy is charged on a graduated rate. So for the first category of people who pay yearly rent or up to seven years rent at once, the Stamp Duty payable is 0.78 percent. This is not up to 1 percent. The implication of the above is that if your rent is N100,000 per annum, the amount due at 0.78 percent is just N780.00


Now for tenants whose agreement is above seven years and up to 21 years. If you can afford to pay rent for 21 years, the Stamp Duty chargeable is three percent since you are not going to pay rent for a long time, so, three percent is deducted to provide social amenities and fund infrastructure.


There are people who would comfortably pay rent for above 21 years; for 22 or 25 years, such people will not go back to their landlords to pay rent again. Therefore, the law states that such people should pay 6 percent of the rent as Stamp Duty.

Who remits the Stamp Duty?

  • For individual to individual payment:

In VAT administration, the service provider collects the VAT component from the consumer. For ease of administration of Stamp Duties, in the case of individual to individual (tenant to landlord) agreement, the tenant is the agent of collection. The tenant is not expected to pay the stamp duty component of rent to the landlord who is also an individual. what the tenant is expected to do is, once an agreement is reached with the landlord or agent, he takes 0.78 percent of the rent sum (depending on the above categories) to the bank and pays into the stamp duties account (for instance, 0.78 percent of 100,000 is N780). The bank gives him a teller or an e-ticket as evidence of payment. The tenant presents the payment evidence to the landlord, before he is entitled to the copy of the rental agreement.


For emphasis, the tenant does not pay to the individual landlord; he must insist on going to a bank nearby to remit the Stamp Duty element of the rent. It is equally the responsibility of the landlord to ensure that the Stamp Duty element of the rent is paid to the bank before he issues receipt or a copy of the agreement to the tenant. The evidence of payment of the Stamp Duty should be made available to him. This decision is taken because if an individual landlord is asked to collect the money and pay into the Stamp Duty account, some of them can take the money from the tenants and fail to remit same to the Stamp Duty account in the bank. If a landlord fails to ensure that the Stamp Duty element is remitted before an agreement is signed, such a landlord will bear the burden of payment.

  • For entities and individuals or a body of individual’s payment:

If the transaction is between entities or between entities and an individual or a body of individuals, the landlord is the agent of collection and should ensure that the tenant pays to the FIRS account which is a Federation Account. That money is collected and shared among the three tiers of Government. If the rent is between an individual and another individual, the Stamp Duty element will be paid to the State Government where the property is situated. For example, if a tenant is living in Ikoyi, Lagos State, the Stamp Duty element of his rent will be paid to the Lagos State Stamp Duty account.

NOTE: This has nothing to do with someone who is living in his own house even if it is a ten-storey building. You are not going to pay Stamp Duty on your own house. The essence of this is to legalize the agreement between you and the landlord.

Culled from interview with the Executive Chairman of the Federal Inland Revenue Service (FIRS) Muhammad M. Nami, FIRS Chairman.

Do you have any further questions? feel free to call Ibejulekkilawyer on 08034869295 or send a mail to and we shall respond accordingly.

Disclaimer: The above is for information purposes only and should not be construed as a legal advice. (blog) shall not be liable to any person(s) for any damage or liability arising whatsoever following the reliance of the information contained herein. Consult us or your legal practitioner for legal advice.

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