Stamp duty on a company's loans and debentures
When a Nigerian company pays stamp duty on loan capital it raises, which loans the NRS leaves out, and how to record the duty and file the deed.
By Achekam · · 4 min read · For Running a business businesses in Nigeria
When a Nigerian company borrows to buy equipment, build a warehouse or refinance, the conversation is all about the interest rate, the tenor and the security. Stamp duty rarely comes up until the documents are signed, and sometimes not even then. Yet the NRS treats a company's loan capital as a dutiable instrument, and the duty falls on the company that receives the money.
This article explains which company borrowings attract stamp duty, which ones the NRS leaves out, what the NRS's own worked example shows, how security documents fit in, and how to record the duty in your books and keep the stamped deed where you can find it.
Loan capital, charged ad valorem
The NRS's Information Circular No. 2026/04, Clarification on Dutiable Instruments, published on 29 June 2026, says loan capital of a company is charged ad valorem stamp duty, meaning duty calculated as a proportion of the amount, payable by the beneficiary of the disbursement.
The beneficiary of a loan is the borrower. So, unlike some instruments where the other party pays, here the company raising the loan capital is the one responsible.
The circular sits under section 123 of the Nigeria Tax Act, 2025, which, as the NRS explains it, imposes stamp duty at a fixed or ad valorem rate on any instrument first executed in Nigeria, or executed outside Nigeria and relating to property situated, or any matter or thing done, in Nigeria. A loan agreement signed abroad for money used in Nigeria is not outside the net simply because of where it was signed.
The loans left out
The NRS circular excludes three kinds of borrowing from the loan capital charge:
- overdrafts;
- loans for a period of not more than twelve months;
- loans obtained for onward lending to another person.
That covers a good deal of ordinary working-capital finance. A business running on an overdraft, or taking a short facility to bridge a few months, is outside this particular charge. A five-year term loan or a debenture issue is inside it.
Watch the twelve-month line closely. A facility described as short-term but with an automatic rollover, or one restructured into a longer loan, may not stay on the excluded side. Ask your adviser to look at the actual terms.
The NRS's debenture illustration
The circular includes a worked example. It applies 0.125% to a 2 billion debenture, giving duty of 2.5 million. The circular shows these amounts without a currency sign.
Treat the example as an illustration of how the calculation works, not as a statement of the rate for every instrument. Confirm the rate that applies to your instrument with your adviser at the time of writing, and read the circular itself: the NRS Information Circular on dutiable instruments sets out what is dutiable, who pays each duty, the 30-day stamping deadline and the consequences of not stamping.
Thirty days from execution
The NRS says every instrument executed in Nigeria must be stamped not later than 30 days after its execution by the person obligated to pay the duty. PwC's summary says the same about the 30 days.
For a loan, "execution" is the signing of the loan agreement or debenture. If drawdown happens later, the clock has still started at signing. Put the stamping deadline in the calendar the day the documents are signed.
Security documents and the person taking security
Loans usually come with security: a charge over assets, a mortgage, personal security from a director. PwC says that under the Nigeria Tax Act, the duty on an instrument is payable by the transferee in a transfer of real property, by the beneficiary of a service, or by the person taking security.
On a secured loan, the person taking security is the lender. So the duty on the security document and the duty on the loan capital may fall on different parties. Ask your lender at term-sheet stage how stamping of each document will be handled, who will pay what, and who will hold the stamped originals.
Recording the duty and filing the instrument
In the books. In Achekam, a business can post manual journals. An unbalanced journal, or one dated in a closed month, is refused, and a posted journal is corrected only by a reversal. Record the stamp duty paid by journal, with the NRS receipt reference in the description. Agree with your accountant whether the duty is expensed at once or treated as a cost of the loan spread over its term, and use the same treatment for every loan.
The signed documents. Any document can be sent for electronic signature in Achekam, with signature and initials fields, signers in order or all at once, an expiry and reminders, and the signed PDF and a completion certificate are filed back into Documents. Whether your lender accepts e-signed loan documents is a question for the lender.
The stamped deed. Document Centre is a folder-based store with search and tags, and a new version of a file keeps the earlier ones. Keep the signed agreement, the stamped version and the stamping receipt together in a folder for that facility, so the stamped copy is never separated from what it stamps.
Questions to ask your lender
- Is this facility more than twelve months, including any rollover?
- Is any part of it for onward lending, and is that documented?
- Which documents will be stamped, and who pays each duty?
- Who stamps them, and who keeps the stamped originals?
- When will we receive copies of the stamped documents and receipts?
Stamp duty on everyday contracts is covered in stamping business contracts in Nigeria, and the duty when the loan buys property is in stamp duty when your business buys property.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
