In Nigeria, the price you agree for a property is only part of the real cost — and the document you receive at the end matters just as much as the money you pay. Too many buyers focus on the purchase price and overlook the taxes and the all-important title paperwork. This guide explains the Certificate of Occupancy and the main property taxes every buyer should understand.
The Certificate of Occupancy: your foundation of ownership
Under the Land Use Act, land in each state is ultimately vested in the Governor, who grants rights of occupancy. The Certificate of Occupancy (C of O) is the document that formally evidences your right to occupy and use the land, typically for 99 years. Without a clean, verifiable title, you are exposed to disputes, double sales and revocation.
Before buying, always:
- Conduct a title search at the state land registry to confirm the seller’s ownership and that the land is free of encumbrances.
- Check that the land is not under government acquisition or committed to another purpose.
- Use a property lawyer to verify documents — never rely on a survey plan or receipt alone.
Governor’s Consent: the step buyers forget
When a property that already has a C of O is sold, the transaction generally requires the Governor’s Consent to be valid. Skipping this step is one of the most common mistakes in the Nigerian market: an assignment without consent can be challenged later. Budget for it, both in time and in cost.
The taxes you pay when buying
Several charges arise at the point of purchase and perfection of title:
- Stamp duty on the deed of assignment.
- Registration fees at the land registry.
- Consent fees connected to the Governor’s Consent process.
- Legal and agency fees for the professionals handling the transaction.
Together these “perfection” costs can add a meaningful percentage to the purchase price, so factor them in before you make an offer.
The annual cost of ownership: Land Use Charge
Once you own, you may be liable for annual property taxes. In Lagos, for example, the Land Use Charge consolidates ground rent, tenement rate and neighbourhood charges into a single annual bill based on the assessed value of the property. Other states operate their own tenement or property rates. Keeping these payments current avoids penalties and protects your standing as owner.
Capital gains tax on resale
When you sell a property for more than you paid, the gain may attract capital gains tax. Keep your purchase deed and receipts for any improvements: documented costs raise your acquisition base and reduce the taxable gain when you sell.
If you rent it out
Rental income is taxable. Maintain simple records of rent received and deductible expenses (repairs, management, maintenance) so you can declare correctly and keep your tax affairs clean.
Three rules that protect every buyer
- Verify the title before you pay — a title search and a lawyer are non-negotiable.
- Perfect your title through Governor’s Consent, stamping and registration.
- Keep every document and receipt — they protect your ownership and reduce future tax.
This article is general information and does not replace advice from a qualified property lawyer or tax professional on your specific transaction.
