Can I capitalize stamp duty on a land purchase?

Question

We have purchase a land and we need to pay stamp duty to government on the purchase. Can we capitalize the stamp duty or it should be expenses?

Answer 1

IAS 16.16 says

"The cost of an item of property, plant and equipment comprises:
(a) its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates."

Since stamp duty is a non-refundable tax, you can capitalize with the land cost.

Answer 2

Yes, non-refundable taxes incurred on the acquisition of items of PP&E is to be capitalized according to IAS 16, PP&E. The stamp duty is an example non- refundable tax which must be capitalized as part of the cost of the asset acquired.