Tamil Nadu Stamp Duty & Registration Charges 2021
Investing in real estate invites several additional charges. Some of these charges include the stamp duty charges and the registration charges, a revenue source for the government. Stamp duty charges and registration charges are necessary additional costs as they play a vital role in concluding a property transaction. Thus you must know all the relevant details regarding the stamp duty charges while investing in real estate properties.
What is Stamp Duty?
Stamp duty is a form of tax paid to the state government by the buyers on purchasing a new property. The payment of stamp duty becomes essential as it is a legal proof of ownership and validates the purchase-sale transaction. In India, the stamp duty charges on the property range between 5-9% of the property value. The stamp duty is computed by charging the percentage against the market value, circle rate, or the consideration value of the property, whichever is higher. For Example, A decides to sell off his property for an agreed matter of Rs. 70 Lakhs while the circle rate of the property is Rs. 60 Lakhs. In this case, the stamp duty will be imposed on the agreement value as it is higher.Who pays Stamp Duty Charges?
The homebuyer generally pays the stamp duty charges. However, there are also instances wherein both parties meet the stamp duty charges. On the failure of the homebuyers to furnish the stamp duty charges adequately, he can be penalized. The quantum of penalty various from one State to another, and generally, the violators are required to pay 8-20% of the actual stamp duty or may be changed with imprisonment. The law also proposes a 2% reduction in the stamp duty if the property is registered in a female family member’s name.Stamp duty charges in Tamilnadu
Tamilnadu is one of the states that charge high rates as stamp duty. Thus it is recommended that you keep a significant sum as a reserve which purchasing property in Chennai. The State charges 7% of the property’s market value as stamp duty and 4% of the market value as registration fee for the registration of conveyance deed, gifts, and in case of exchange.Stamp Duty In Family Partition
In case of partition in a family, the deed shall be registered by paying 1% on the market value of the property, to a maximum of Rs 25,000 for each share, as the stamp duty and 1%, subject to a maximum of Rs 4,000 on each share as the registration fee. This is the fee that is applicable in case the partition is taking place between family members. In cases wherein the partition includes people who are not family members, you must furnish 4% on the property’s market value for separated shares as the stamp duty charges and 1% on the market value of the property for separated shares.Stamp Duty on General Power of Attorney
The charges imposed on the registration of General Power of Attorney include:| Document | Stamp Duty | Registration fee |
| A general power of Attorney in case of sale of immovable property. | Rs 100 | Rs 10,000 |
| General Power of Attorney whereby the power is provided to another family member. | Rs 100 | Rs 1,000 |
| Power of Attorney for consideration | 4% of the consideration | 1% of consideration or Rs 10,000, whichever is higher |
Stamp duty on Mortgages
In the case of a simple mortgage, 1% of the loan amount, subjected to a maximum of Rs. 40,000 is charged as stamp duty and 1% on the loan amount, subjected to Rs.10,000 is charged as registration fee. For the registration of the agreement of sale, you are required to furnish Rs. 20 as stamp duty and 1% on the money advanced as the registration fee. In case of the agreement relating to construction activities, you must pay 1% on the cost of the proposed construction or the value of construction or the consideration specified in the agreement, whichever is higher as stamp duty and as registration fee.Stamp Duty on Lease
The stamp duty imposed on lease for less than 30 years is 1% on the total amount of rent, premium, fine, etc., and the registration charges on the same are 1%, subject to a maximum of Rs 20,000. If the lease is for a period up to 99 years, then 4% on the total amount of rent, premium, fine, etc., is charged as stamp duty, and 1%, to a maximum of Rs 20,000, is charged as a registration fee. In case of a lease for more than 99 years or perpetual leave, 7% on the total amount of rent, fine, a premium of advance, etc., is payable as stamp duty.Bottom Line
Stamp duty charges are essential changes that need to be paid to gain legal ownership of the property. It is necessary for the legal transfer of ownership and becomes payable on registration or the day on which the documents are executed. The process of registering the property can be complicated. The process can be made more comfortable with the help of an excellent real estate agent. Assetmonk is a smart real estate platform that provides you with RERA-approved projects. Assetmonk also helps in easing your real estate transactions in Chennai as it offers carefully vetted assets customized to meet the objectives of different investors.Tamil Nadu Stamp Duty & Registration Charges 2021 FAQs:
Registration fee is the amount that covers the stamp duty over and above. In Tamilnadu, the stamp duty is charged at a rate of 7%, and the registration fee is charged at 1% of the market value.
Before proceeding with land purchase, you must conduct due diligence and verify ownership of the property. For this purpose, you may apply for EC with the registrar’s office. If the due diligence results are satisfactory, you may carry out the documentation for the transaction. You may purchase stamp duty paper according to the amount arrived through land guideline value. Draft a sales deed and get it registered with the help of two witnesses. You are also required to bring the necessary identity proof for the verification activities as well.