All You need to Know about Stamp Duty on Property

Under Section 3 of the Indian Stamp Duty Act, 1899, it is mandatory for the buyer to pay the stamp duty and the registration charges when buying a property. It must be paid after the sales deed is processed and the amount must be mentioned clearly in the sales deed. The sales deed and the proof of the stamp duty payment stand as proof of your property ownership.

We discuss everything you need to know about the stamp duty before buying a house:

Stamp duty rate

It varies from state to state. Every state has its own stamp duty rate. Many states even offer discounted stamp duty rates if a woman is applying as the owner or co-owner.

Registration fees

Even though stamp duty varies, registration charges are the same across the country.

The penalty in case of non- payment

Since stamp duty is onetime payment, there’s also a penalty for non-payment of the same. If one fails to make the payment, then they can be fined up to two percent of the total cost of the property that needs to pay every month along with the outstanding payment.

Stamp duty for apartments

The apartment owners have to pay the stamp duty along with the individual share of the property. For example, if a property is built on 20,000 sq ft and there are five apartments, then each owner will have to pay stamp duty for 4,000 sq ft.

Documented proof of ownership

If you have paid the stamp duty, then the same is mentioned in the sales deed which acts as the proof of your ownership of the property, in case there is any dispute over the ownership in the future.

State subject

Every state has its own stamp duty laws and has the freedom to change them as per requirement. The stamp duty amounts to one the largest revenue collection of every state.

Online payment of stamp duty

Many states have given the provision to pay the stamp duty online. Few states are also offering discounts on the online payment of stamp duty.

Home loan eligibility of LIG

Earlier, the banks did not add stamp duty and registration charges to the property’s cost which caused the home buyers to part with their own savings. In 2015, the RBI directed banks to factor the stamp duty cost and registration cost if the cost of the property is less than Rs 10 Lacs. This was aimed to motivate the low-income group to invest in property.

Stamp duty for home loan agreement

Banks charge stamp duty if you are availing the home loan. The charges can be anywhere around 0.1 to 0.2 percent. The bank asks you to keep the property documents with them until you have paid the entire loan amount.

Looking for property portal?

Find a property Post property

FM Announces Rs 20,000 Crore Funding for Projects Stuck in the Middle

On 14th September, the Finance Minister, Nirmala Sitharaman, announced few more measure to revive the slow real estate market. The primary concern for the buyers has been the projects that are stuck for resolution as they have run out of money. To so...

Sep 19, 2019
Deadline for Income tax return extended till June 30-2020

The economic health of the country is affected due to the outbreak of COVID-19. On March 24, 2020, the government announced the measures taken to help support the growth of the economy. Amidst the outbreak, the deadline for filing the GST return has ...

Apr 10, 2020
How to Fund Your Property Buying Through Your Provident Fund

Salaried individuals have a provident fund account, but not many are aware that one can use the PF money to buy or renovate their property. Under the provident fund scheme, an employee can withdraw the money from the PF account after completing five ...

Jul 25, 2018
Forecast of Price Fluctuations in Realty Market Due to Demonetization

Demonetization is one of the most discussed topic these days where there have been constant speculations doing the round which have created various opinions among the public which say whether the demonetization will bring down the prices of property ...

Apr 18, 2017