[ecis2016.org] Here’s a look at the latest stamp duty charges and property registration charges in Tamil Nadu for 2021 and how it impacts your property purchase
The stamp duty charges in Tamil Nadu applicable on property transactions is quite high compared to other Indian states. This means, when you buy a property in the state, you will need to reserve a significant amount towards the mandatory stamp duty and registration charges.
You are reading: Stamp duty and registration charges in Tamil Nadu
Stamp duty is the fee that you are liable to pay to the authorities, in order to register a property under your name. Registration fees are paid to the same authority for doing all the paper work to execute this process.
Let us discuss the monetary implications of this on a home buyer in Tamil Nadu, in detail. Also, we share the various stamp duty and land or property registration fees applicable in Tamil Nadu.
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Stamp duty and registration charges in Tamil Nadu 2021: Applicable charges for various documents
| Document type | Stamp duty in Tamilnadu | Registration charges in Tamilnadu |
| Conveyance (Sale) | 7% of the market value of the property | 4% of the market value of the property |
| Gift | 7% of the market value of the property | 4% of the market value of the property |
| Exchange | 7% of the market value on the property that has the greater value | 4% of the market value on the property that has the greater value |
| Simple mortgage | 1% on the loan amount, subject to a maximum of Rs 40,000 | 1% on the loan amount, subject to a maximum of Rs 10,000 |
| Mortgage with possession | 4% of the loan amount | 1%, subject to a maximum of Rs 2,00,000 |
| Agreement to sale | Rs 20 | 1% on the money advanced (1% on total consideration if possession is given) |
| Agreement relating to construction of building | 1% on the cost of the proposed construction or the value of construction or the consideration specified in the agreement, whichever is higher | 1% on the cost of the proposed construction or the value of construction or the consideration specified in the agreement, whichever is higher |
| Cancellation | Rs 50 | Rs 50 |
| Partition among family members | 1% on the market value of the property, subject to a maximum of Rs 25,000 for each share | 1%, subject to a maximum of Rs 4,000 for each share |
| Partition among non-family members | 4% on the market value of the property for separated shares | 1% on the market value of the property for separated shares |
| i) General Power of Attorney to sell the immovable property | Rs 100 | Rs 10,000 |
| ii) General Power of Attorney to sell the immovable property (Power is given to a family member) | Rs 100 | Rs 1,000 |
| iii) General Power of Attorney to sell the movable property and for other purposes | Rs 100 | Rs 50 |
| iv) General Power of Attorney given for consideration | 4% on the consideration | 1% on the consideration or Rs 10,000, whichever is higher |
| Settlement in favour of family members | 1% on the market value of the property but not exceeding Rs 25,000 | 1% on the market value of the property, subject to a maximum of Rs 4,000 |
| Settlement in other cases | 7% on the market value of the property | 4% on the market value of the property |
| Partnership deed where the capital does not exceed Rs 500 | Rs 50 | 1% on the capital invested |
| Partnership deed (other cases) | Rs 300 | 1% on the capital invested |
| Memorandum of Deposit of Title Deeds | 0.5% on loan amount, subject to a maximum of Rs 30,000 | 1% on loan amount, subject to a maximum of Rs 6,000 |
| i) Release among family members (coparceners) | 1% on the market value of the property but not exceeding Rs 25,000 | 1% on the market value of the property, subject to a maximum of Rs 4,000 |
| ii) Release among non-family members (co-owner and benami release) | 7% on the market value of the property | 1% on the market value of the property |
| Lease below 30 years | 1% on the total amount of rent, premium, fine, etc. | 1%, subject to a maximum of Rs 20,000 |
| Lease up to 99 years | 4% on the total amount of rent, premium, fine, etc. | 1%, subject to a maximum of Rs 20,000 |
| Lease above 99 years or perpetual leave | 7% on the total amount of rent, fine, premium of advance, if any, payable. | 1%, subject to a maximum of Rs 20,000 |
| Declaration of trust (if property is there, it would be considered as sale) | Rs 180 | 1% on the amount |
Source: Registration Department, TN
Note: Stamp duty is always shown in percentage terms. The stamp duty amount is a specific percentage of the property transaction value. This means that if the buyer has purchased the property for Rs 50 lakhs, he has to pay 7% of Rs 50 lakhs as the stamp duty in Tamil Nadu. He has to pay another 4% of Rs 50 lakhs as the land registration fees in Tamil Nadu. So, the buyer will have to keep 11% of Rs 50 lakhs, to pay these state duties.
The charges are applicable as per the Tamil Nadu Stamp Act, 2019 and the Indian Stamps Act 1899. According to the acts, payment of stamp duty and registration charges in Tamil Nadu is mandatory for all property transactions. As per the Tamil Nadu Stamp Act, stamp duty is compulsory for some deeds.
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Registration of Settlement Deed
A settlement deed refers to a legal document wherein the parties settle their differences or disputes, in cases related to immovable properties such as land. The document needs to be registered for it to be valid. The documents required for settlement deed in Tamilnadu during registration include original title document (and Patta), encumbrance certificate of the property, identity proof and Aadhaar proof of the parties.
The registration fees that must be paid in case of settlement are mentioned below:
- Stamp duty which is 1% of the market value of the property, subject to a maximum of Rs. 25000. Registration fees of 1% of the market value of the property subject to a maximum of Rs. 4000. These charges are applicable for settlement in favour of family members.
- The fees applicable for settlement in other cases include stamp duty of 7% of the market value of the property and registration fee of 4% of the market value of the property.
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Stamp duty and registration charges for women in Tamil Nadu 2021
While most states offer some sort of rebate if a property is registered in the name of a woman, this is not the case in Tamil Nadu. Men and women have to pay the same stamp duty in Tamilnadu and registration fees. In contrast, women home buyers in national capital Delhi pay 4% stamp duty as against the 6% stamp duty that a man has to pay here.
[ecis2016.org] All about Guideline Value in Tamil Nadu. Also read our guide on TNREGINET to know about how to use the Tamil Nadu govt portal to get information on guideline value and more in the state.
Land registration fees in Tamilnadu for a resale property
The Tamil Nadu registration charges for a resale property is 1% of market value or the agreement value of the property. The stamp duty that will be levied on the same is 7%.
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How is stamp duty in Tamil Nadu calculated?
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A property buyer must pay stamp duty in Tamil Nadu as determined by the state government. Stamp duty is charged on the ready reckoner rate / circle rate (also called guideline value in Tamil Nadu) or consideration value of the property, whichever is the higher value.
If the agreement value of a residential property is Rs 50 lakh and the guideline value is Rs 40 lakh, the stamp duty will be calculated on the higher value, that is, Rs 50 lakh.
The stamp duty one is required to pay depends by several factors. That includes the property’s market value, type of property and the number of floors, property location, intended usage (whether residential or commercial), and age of the property.
Go to the official website of the Registration Department known as TNREGINET website to know more about stamp duty payment.
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Stamp duty, registration charges’ impact on final property price
Buyers need to be aware of the property or land registration fees in Tamilnadu as it can impact their overall property purchase.
Let us examine how to calculate the impact of stamp duty and property registration charges in Tamilnadu on the final property price :
Suppose Gokul bought a property in Chennai that has a guideline value of Rs 40 lakhs. He will have to pay the following charges:
- Registration fees: 4% of Rs 40 lakhs = Rs 1,60,000
- Stamp duty: 7% of Rs 40 lakhs = Rs. 2,80,000
Hence, the effective cost of owning this property comes to Rs 44.40 lakhs.
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How to pay stamp duty online in Tamil Nadu?
The payment of stamp duty and land or property registration fees
in Tamil Nadu can be done online, via the e-stamping facility. Stock Holding Corporation of India Limited (SHCIL) is the central record keeping agency (CRA) appointed by the central government for granting e-stamp certificates in the country.
One can visit the SHCIL website and get information on transactions that require stamping and the addresses of collection centres. One will have to fill an application form at an ACC (Authorised Collection Center). The form must be submitted along with payment for the stamp certificate.
The various modes of paying stamp duty in the e-stamping system, include NEFT, RTGS, pay order, demand draft, cheque, cash and account to account transfer. One should reach out to the nearest e-stamping centre before initiating an electronic fund transfer.
Also read: What is e-stamping and how is it done?
Stamp duty and registration charges in Tamilnadu: Latest news
Update on January 3, 2022
Government plans to revise real estate guideline value
The Tamil Nadu government is set to start the process of revision of the real estate guideline value. It is likely to issue an order to constitute a high-level committee and a steering committee for the rationalisation of market value guideline to start the process for the 18th time.
The guideline value was first revised on September 1, 1981. The Tamil Nadu Stamp (Constitution of Valuation Committee for Estimation Publication and Revision of Market Value Guidelines of Properties) Rules, 2010, came into effect. In April 2012, the guideline value was revised for the 16th time.
Revenue from stamp duty and property registration fees in Tamil Nadu remains robust
As per the State’s Registration Department, Tamil Nadu’s revenue from stamp duty and property registration fees continued to be robust in 2021-22. The collections during the period from April to November 2021 was at Rs 8,448.42 crore.
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Update on November 9, 2021
Tamil Nadu witnesses record-high revenue through property registrations in September 2021
With the steady revival of the realty sector in Tamil Nadu after the COVID-19 second wave, the state witnessed increased property registrations, generating record-high revenue in September 2021. The income through land and property registrations in the state reached nearly Rs 1,500 crore in September, which is the highest in a month recorded in any year. As per the data obtained from the registration department, the income in September accounted for 25% of the overall revenue generated during April and September in the financial year 2021-22. Chennai zone, which includes the city, Chengalpet, Kancheepuram, and Tiruvallur districts contributed about 45% of the total revenue.
Tamil Nadu government plans to boost revenue through property registrations after COVID-19 second wave
August 9, 2021: State minister for commercial taxes and registration, P Moorthy, recently conducted a review meeting with registration officials, to discuss opportunities to increase revenue through property registrations, after the second wave of the Coronavirus pandemic. Revenue to the tune of Rs 10,643 crores was recorded during April 2020 to March 2021 through stamp duty and registration fees.
Tamil Nadu may allow property registrations on auspicious days
With an aim to garner more revenue, the Tamil Nadu government may allow property registrations on three days considered auspicious in the Tamil calendar. So far, sub-registrar offices in Tamil Nadu are closed on these days. The days that the state is considering to allow property registration on, include Thai Poosam and Aadi Perukku. However, those registering property on these days may have to pay extra.
TN govt may make registrations compulsory for joint ventures
The registration and finance departments of Tamil Nadu are discussing the feasibility and modalities of reducing the registration fee for joint ventures (JVs) in the state. Currently, 75% to 80% of the residential and commercial projects in the state are undertaken as JVs. However, with the registration charges being as high as 11% of the guideline value, these are not registered. So far, registration of the JVs was not mandatory. To encourage registrations, the authorities are considering bringing down the fee to 2% of the guideline value. It will also become mandatory to register JVs, therefore, making it legally binding.
This change would require an amendment to the Registration Act, 1908, which, in turn, requires the union government’s assent. The idea behind this move is to ensure healthier revenue for the state government.
Property registrations in Chennai amid COVID-19
During the early part of 2020, owing to the Coronavirus pandemic and the resultant lockdown, property registrations saw a dip. However, starting August 2020, sales did see an uptick and this is evident through the revenue generated from property registrations in August, which amounted to Rs 793 crores. Sources also suggest that 17,000 more registrations were clocked this year in August, as against the same period in 2019.
“Plotted developments and land parcels in and around Chennai moved faster, comparatively,” says T Balabhaskar, a local real estate contractor, adding that sales suffered on the whole, owing to restrictions on inter-state travel and rising cases of COVID-19. Local brokers are also hopeful that actual sales will pick up, given that enquiries on ground have increased. Prospective home buyers have been enquiring about price benefits, cash discounts and customised packages and see an opportunity to invest, in spite of the pandemic.
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In May 2020, the registration department of TN clarified that new and ready-to-occupy flats and buildings will not need to pay stamp duty and registration fees. This was applicable only on the first sale of the property and only the undivided share of land (UDS) would be subjected to stamp duty and registration charges and not the super built-up area.
Record-high registrations in October 2020
On October 29, 2020, the registration department witnessed an all-time high registration of 20,307 documents with 575 sub-registrar offices. The sale of stamp duty and registration fees on the day brought in Rs 123.35 crores. October had been a good month for the department with earnings clocked at Rs 1,096 crores.
Will Tamil Nadu reduce stamp duty?
Industry body Confederation of Real Estate Developers’ Association of India (CREDAI) has said that it has discussed the possibility of stamp duty reduction in a high-level meeting chaired by the state’s deputy chief minister, O Panneerselvam. The state and its economy, which were heavily hit after the floods that devastated the livelihoods of many in 2015, was dealt a further blow in 2020 following the COVID-19 pandemic. Therefore, the industry body feels that to provide some relief to prospective home buyers, the authorities must act soon.
“From 11% (both stamp duty and registration charges), we have requested for a reduction to 5% stamp duty and 1% registration charge permanently and as a short-term measure, we have asked reduction to 4% stamp duty and 1% registration charge till March 31, 2021,” said S Sridharan, CREDAI chairman, Tamil Nadu chapter. Only time will tell whether the state government will give its nod.
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FAQs
Is it mandatory to register property in Tamil Nadu?
Yes, as per the Registration Act, 1908, it is mandatory to register your property.
Where can I pay stamp duty in Chennai?
You can either pay the stamp duty at the registrar/sub-registrar’s office or avail of the e-stamping facility.
What are the documents required for registration of property?
You will need the stamp duty receipt, your PAN card, government ID proofs of all parties, including the witnesses, two passport-sized photographs, NOC, no dues certificate, sale deed, POA, pattadar passbook, etc.
Can I pay stamp duty by credit card in Tamil Nadu?
The Department of Registration in Tamil Nadu takes initiatives such as equipping registrar offices with facilities like PoS (Point of Sales) devices and enable citizens to pay their property registration charges using debit cards or credit cards.
(With additional inputs from Sneha Sharon Mammen)
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