22 Jan




Tax is a compulsory charge by the government on the income or profit of an individual, company, trust or estate. Usually levied to generate revenue to cover government endeavours and expenditure. Certain property transactions can be taxed. Whether ethics in taxation is necessary.

They include:

– Stamp Duties (Act): tax levied on instruments evincing chargeable transactions like; Mortgage Deeds, Leases, POA, Sale, etc. Where between individuals, the affected state collects duty (based on FG agreed rate). If company is involved; the FG collects-Section 4 SDA. Chargeable documents should be stamped with 30 (for ad valorem) and 40 days (for others). Failure to stamp attracts fine and document could be inadmissible in evidence. The rate in Lagos is 2 percent. See generally AG Ogun v AG Federation, AG Fed v AG Abia.

– PIT(A): on income, and profits of individual, group, communities, families, executors or trustees. Wholly, exclusively, necessarily and reasonably… Interests from loans, expenses incurred in repair of premises, purchase and repair of productive assets, bad debts, deductions or contributions for pensions and retirement benefits, etc. are deductible.

Chargeable persons are expected to do self-assessment and file on oath within 90 days from the commencement of every year of assessment otherwise best of judgment can be done by the taxing authority.

– VAT(A): on supply of vatable goods and services. 5%. Provided by producer, wholesaler, supplier, retailer of vatable goods and services excluding public authorities-S 2 VATA. Vatable persons should register with FIRS. AG Lagos v Eko Hotels Ltd. Although various issues but appears to be administered by FIRS in cooperation with Customs and State Inland Revenue. Share revenue for 15, 50, 35 to FG, States and LG

– CGT(A): charged on the gains accruing from the disposal/alienation of assets (leases, transfers, assignment, sale, compulsory acquisition, etc.) does not include mortgage or transfer by PR-Section 6 CGTA. Allowable deductions include; expenses wholly, exclusively and necessarily incurred in the acquisition of the asset, enhancing of the value, defending the title/right over the asset, incidental costs incurred in making the disposal. S 13 CGTA. In Oram v Johnson cost of personal labour of tax payer was not allowed. The following are exempted; Charitable, educational (of a public character) organisations, registered friendly society, cooperative societies, trade unions, LGs, Export Companies. Also goods disposed by way of gift are exempted.

Computation Section 11 CGTA the tax base is Consideration received – initial cost of property – allowable expenditure levy is 10 percent of

– CIT(A)

– Tenement Rates (Laws): imposed on buildings on land (not land without building-Section 88 Kaduna State LG(Administration) Law No. 16 of 2003) From Section 1(j) of the 4th Schedule to the CFRN 1999 we can see that collection of tenement is by LGCouncil at such rates as may be prescribed by the HOA of the State.

Liability first rests on the owner, if he defaults (usually for more than 3 months), then the subsequent owner or occupier or agent (who collects tenements) may be held liable. Can recover the rates from the owner in whom primary liability was placed and where after written demand notice, he refuses, he can sue.

Property can be distrained with surcharge adding for every month of default. In Lagos, it is a graduated percentage from 25-50-100 percent for 45-75-105-135 days of default and after these, the property would be subject to receivership until outstanding taxies, penalties and administrative charges are paid.

There could also be fine and or imprisonment from 6 months to 1 year imprisonment or both

Places of pubic worship, cemeteries, non-profit making institutions engaged in charitable purposes and others who by gazette are exempted from paying CGT. S 3 LUCLL (adds palaces of recognised chiefs,

– Ground Rent: imposed by governor of a state for the grant of right of occupancy.

– Consent Fee: Charged for grant of governor’s consent from 3-5 percent of the value paid. In Lagos it is 8 percent. Note 22 LUA for consent.

– Withholding Tax on Companies: Total v Akinpelu.

– Registration Fees: in Lagos it is 3 percent of assessed value of the property.

TCC shows that 3 years immediately preceding, the holder has duly paid his tax. i.e. is tax compliant. Section 85 PITA. This TCC is usually required for certain endeavours and transaction. E.g. application for loan, transfer of real property, registration of company, etc.

It appears for most of the taxes? Default can be construed after notice has been served but tenant still defaults.

Note effects of payment and non payment of tax (some include; recoverable as debt, fine, penalty, imprisonment, receivership, distrain, TCC.


Pay tax on your fees (don’t evade) and advice client to be tax compliant too.





Distinction between Wills and related transactions.

Nomination: a directive by a person that upon his death, his funds in an organization should be paid to a specified person (nominee). Although nomination is testamentary and ambulatory, it can only dispose funds and need not comply with strict statutory requirements.

Gifts: need not be testamentary but should be handed over in presence of witnesses. Advantageous for being outside tax and estate fee net.

Settlement inter-vivos: is not testamentary but during settlor’s lifetime.

Donatio Mortis Causa: is a disposition made in contemplation of (and takes effect after) death. Donor must part with dominion and control of the property.

After doing all his duty and discharge, the PR assumes the position of a trustee

Trust Corporation, To propound a will means to ask court to sanction veracity of the will.

  • Abuja Geographic Information Systems (AGIS): is used to investigate land title in Abuja. Write to AGIS attaching particulars of the land, vendor’s letter of consent, and receipt of search fee from the designated bank. Workers at AGIS will conduct the search and fill a search report to be signed by Registrar of Deeds. CHECK SPECIMEN AT 261. abujagis.com. Solicitor should explain the procedure to his client so he’d not be liable for negligence of the staff. Disadvantage is that solicitors do not directly access the information and the staff may lack requisite computer technology. Y.Y Dadem has suggested the physical and AGIS system should operate side by side.


Quite eccentric really

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