In the first part of this article that was featured in the previous week (02/09/2021), we discussed the administration of Stamp duties, dutiable instruments and how to stamp an instrument. In continuation of this topic, we will discuss some other aspects of stamp duties in Nigeria.
Stamp duties are payable on dutiable instruments listed in the schedule to the Stamp Duties Act (hereinafter SDA or the Act). Section 23 of the Act provides that all instruments chargeable with stamp duty may be stamped within 40 days from the first execution thereof upon payment of the charged duty except otherwise provided in any other law.
Failure to stamp the instrument within the prescribed period attracts a penalty in addition to the unpaid duty. Where the instrument to be stamped is chargeable with ad valorem duty, the instrument is required to be stamped before the expiration of 30 days after its first execution, or after its reception in Nigeria if it was first executed at any place outside the shores of Nigeria.
The limitation of 30 or 40 days will not apply where an instrument has been submitted to a Commissioner for his opinion before the expiration of the said 30 or 40 days as the case may be. In such a situation, the instrument may be stamped in accordance with the assessment of the Commissioner within 21 days after notice of the assessment. It should be noted that any incomplete document does not need a stamp and if the rate of duty changes before a document is complete, the document would be assessed with the new rate of duty. A document will be treated as complete when the last party executes it.
All duties imposed under this Act must be paid within one month after the liability to pay the duty arises, delay will render the assessment invalid or even attract further penalty.
Failure to pay stamp duties to the appropriate authority within the time stipulated in the SDA is an offence and it could attract penalty and interest.
These instruments are only exempted from the payment of stamp duties, they will however be stamped in order to be admissible in evidence.
A person who is not satisfied with the assessment of stamp duties may, within 21 days after the date of the assessment and on payment of duty, appeal against the assessment at the High Court of the State in which the assessment was made. Please note that in practice, this position is not consistent with the Federal Inland Revenue Service (Establishment) Act which requires appeals to be filed at the Tax Appeal Tribunal. In line with this, appeal may be filed at the relevant zone of the Tax Appeal Tribunal. This is according to section 68(2) of the FIRSEA which requires that the FIRSEA would prevail in case of inconsistency with other tax laws.