What is the documentary stamp cost on promissory notes?

The documentary stamp cost on promissory notes is calculated by taking the loan amount, dividing it by $100 to determine the number of taxable increments, and then multiplying that figure by the rate of $0.35. This method ensures that the calculation accounts for the way taxes are structured, as they are assessed based on increments of $100.

This approach is advisable because it aligns with how tax assessments typically work in relation to promissory notes. The $0.35 rate reflects the specific charge for documentary stamps applied to these financial documents within the relevant jurisdiction, providing a clear formula to arrive at the total cost effectively. Therefore, this option accurately encapsulates the correct calculation process for determining the documentary stamp tax due on the amount of the promissory note.