On What Basis Is The Percentage Of Stamp Duty Calculated On A Flat Purchase In India?

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Rajesh Shri Profile
Rajesh Shri answered
Stamp duty is the tax that has to be paid in full and one time when you buy, transfer, or gift property. In the event of buying or gifting the tax is payable by the person in whose name the property is being transferred. In the case of an exchange, both parties are responsible for transfer. If you delay the payment, you will be liable to pay a penalty of 2% per month on the unpaid amount. This could lead to a maximum penalty of up to 200% on unpaid amount of stamp duty. Stamp duty as to be paid to establish legal ownership of a property as documents not properly stamped are not accepted in court as evidence.

The basis for calculation of stamp duty on a property depends on a few variables.

1.First and foremost is the price of the property itself - For example, in Mumbai per the Bombay Stamp Act, 1958, the stamp duty is dependent on the market price. Up to Rs.1,00,000 there is no stamp duty. Above 1 lakh but less than Rs.2,50,000 it is 0.5% of the price. Above Rs 2,50,000 but below Rs.5,00,000 it is Rs.1250 + 3% value above Rs.2,50,000. Rs.5,00,000 and above, the stamp duty is Rs.8750 + 5% on the value over and above Rs.5,00,000

2.Which state in India is the property located - The rates of stamp duty varies in different states.

3.Whether it is residential or commercial – There are different rates for residential and non-residential properties. The commercial properties are taxed around 5% more than residential properties.
Muddassar Memon Profile
Muddassar Memon answered
The percentage of stamp duty is calculated on the actual value of a house and it is determined by Brihanmumbai Municipal Corporation.

Stamp duty is a type of tax which is charged on documents. Traditionally, a physical stamp had to be fixed or impressed on the document to signify that stamp duty has been paid prior to the documents being legally effectual. The contemporary editions of the tax no longer necessitate a physical stamp. The central Australian government does not charge stamp duty. On the other hand, stamp duty is charged by states on a range of instruments and transactions. The charges of stamp duty differ from State to State, as do the nature of the appliance of contract subject to duty. Certain jurisdictions no longer necessitate a corporal document to attract what is frequently addressed to as "transaction duty".

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