Landlords will be subject to tighter controls and scrutiny as part of the Papua New Guinea Government’s 2015 Budget. Due to concerns about landlords not declaring rental income to the PNG Internal Revenue Commission, PNG landlords will be required to register with a Taxation Identification Number (TIN) so that their leases will be validly recognised.
Given the relative lack of regulation of PNG’s real estate market, the move by the Government to require landlords to supply a TIN is significant. The new legislation will mandate that landlords provide a valid TIN on lease documentation in order for the IRC to properly identify potential tax payable when stamp duty processing occurs.
The IRC intends to cross reference stamp duty lease data against the IRC’s records of TIN lease data to better identify landlords that do not declare rental income. This strategy is forecast to generate K15 million in additional tax revenue for the forthcoming financial year alone.
Landlords not presently registered with the IRC should register with a TIN prior to July 2015 in order to ensure existing and new property leases are deemed as valid.