4. How do we compute Land Use Charge on a property?
LUC = [(LA x LR)+(BA x BR x DR)] x RR x CR
LUC = annual amount of Land Use Charge in Naira
LA = the area of the land parcel in square metres
LR = the average Market Value of a land parcel in the neighbourhood, on a per square metre basis in Naira based on the market value of the Property as determined by professional valuers appointed by the Commissioner for that purpose.
BA = the total developed floor area of building on the plot of land in square metres, or the total floor area of apartment unit in a building where apartment has a separate ownership title.
BR = the average construction value of medium quality buildings and improvements in the neighbourhood, on a per square metre in Naira based on the market value of the property as determined by professional valuers appointed by the Commissioner for that purpose.
RR = the rate of relief from tax (if any) applicable to the Owner Occupier in the circumstances shall be determined by the Commissioner and shall be published in the State Government Official Gazette and in one or more newspapers circulating within the State and reviewed by the Commissioner once every five (5) years.
CR = the annual charge rate expressed as a percentage of the assessed Market Value of the Property and which may, at the State Government’s discretion, vary between (a) owner – occupied and other property; (b) residential property and commercial (revenue – generating) property; © physically- challenged persons; and (d) persons who have been resident at the same location for at least twelve (12) years, minor, and retired owners and occupiers, on the one hand, and other owners and occupiers on the other.
DR = The depreciation rate for the building and improvement of land which account for the building being of a higher or lower value than the average buildings in the neighbourhood and which also accounts for the degree of completion of construction of the building