Did you know that you will be charged property registration fee, stamp duty charges, cess, and surcharges when you pick a property? Yes, all the charges put together can come up to 7% to 10% of the total market value of the property or more than that. In most states in India, 5% to 7% of the total market value of the property is charged as stamp duty while 1% is charged as registration fee.
Property Stamp Duty Charges in Different Cities
| Name of the City | Stamp Duty Charges |
|---|---|
| Bangalore | 5% of the total market value of the property |
| Delhi |
|
| Mumbai |
|
| Chennai | 7% of the total market value of the property |
| Kolkata |
|
What do You Mean By Property Stamp Duty?
While transferring the title of your property to another person, you will be charged property stamp duty. This is a fee that is levied by the state government on the documents you need to register your property. Stamp duty charges differ from one state to another. You will have to pay Stamp duty while registering a property as it is mandatory under Section 3 of the Indian Stamp Act, 1899.
The state government collects stamp duty to validate your registration agreement. A registration document with a stamp duty paid tag on it acts as a legal document to prove your ownership of the property in the court. Without paying stamp duty charges, one cannot claim the property to be his/her own legally. Thus, it is very important to pay the full stamp duty charge.
Factors that Determine Your Stamp Duty Charges
- Age of the Property: The age of the property plays a crucial role in determining the stamp duty charges you will be required to pay. As stamp duty charges are calculated as a percentage of the total market value of the property, old buildings usually attract less stamp duty charges and new buildings attract a high charge. This is because the market value of old buildings would have depreciated.
- Age of the Owner: Almost all state governments have subsidised stamp duty charges for senior citizens. So, the age of the owner plays an important role in determining the charge.
- Gender of the Owner: Like senior citizens, women in our country also get a discount on stamp duty charges if the property is registered in her name. Men pay about 2% extra to get their property registration documents stamped when compared to women.
- Purpose: Commercial buildings attract a high stamp duty fee when compared to residential buildings. This is mainly because commercial buildings would need a lot of amenities, floor space, and security features.
- Location: If your property is located in a municipal locality or an upscale urban area, be prepared to pay a high stamp duty. If your property is located in Panchayat limits or outskirts of the town, you will land up paying less to get it stamped.
- Amenities: Did you know that the government will charge you for every extra amenity you have on your premises while registering the property? Yes, the government has a list of over 20 amenities that you will have to pay extra for if you have them on your property. Some of the amenities are lifts, swimming pool, library, club, gym, community hall, and sports area.
How is Stamp Duty Charges Calculated?
As mentioned earlier, there are many factors that determine the stamp duty charge you’ll land up paying. The bottom line is that stamp duty charge is calculated:
- considering the total market value of the property. If the market value of your property is high, you will land up paying a high charge and vice versa. In case you have both the market value and the agreement value of the property, whichever is higher will be charged.
- Apart from the cost or the value of the property, the type of the property, location of the property, gender and age of the owner, usage of the property, and the number of floors in the property all determine the property registration fee and stamp duty charges.
- Generally, stamp duty officials use Stamp Duty Ready Reckoner to fix the value of the property. The Stamp Duty Ready Reckoner is published by the concerned state government every year on 01 of January.
Stamp Duty Calculator
If you want to calculate the stamp duty charge you will be asked to pay, consider using one of the many online stamp duty calculators available. In few seconds, you will be able to get an idea of the amount you will need to get your property registered. All you have to do is:
- Enter basic information about your property like the state the property is locating in and the total value of the property and hit on the “Calculate” button to get your answer.
- You can also use a property registration fee calculator online if you wish to know the registration charges.
- Add cess and surcharges to get the total amount you will need to register your property.
- If you are unable to use an online calculator, walk into the nearby property registrar office to find it out.
What Happens, If You Pay Inadequate Stamp Duty?
It is not lawfully right to pay less stamp duty for your property. It is required by law, that you pay the right stamp duty when getting your property registered. Many people undervalue their property and quote a low market value to escape paying high registration fees and stamp duty charges. However, it is not advisable to do so. If caught, you will be asked to pay a huge penalty and can even be imprisoned. Also, if you are a commercial builder, your reputation will be at stake.
