Bangalore: Stamp Duty & Registration Charges
Stamp duty and registration charges are important costs which every buyer has to pay while planning to buy his dream home. These charges vary from state to state.
So, what are the stamp duty and registration charges in Bangalore?
As per the ongoing rates, one has to pay 5 per cent of the registered value of the property as stamp duty. In addition there is a 10 per cent cess and 2 per cent surcharge on stamp duty. Therefore, buyers have to pay 5.6 per cent stamp duty in urban areas and 5.65 per cent in rural areas as the surcharge in such areas is 3 per cent. On the other hand, the registration charges are 1 per cent of the total or registered property value.
|
City |
Stamp Duty (per cent of saleable value) |
Registration charges (per cent of saleable value) |
|
|
Urban areas |
Rural areas |
||
|
Bangalore |
5.6 |
5.65 |
1 |
Source: Karnataka govt. website
How to calculate stamp duty and registration charges?
Both stamp duty and registration charges vary from State to State, with registration charges calculated based on the Indian Registration Act, 1908. Different parameters are used to calculate the registration charges for different types of buildings. In Bangalore, there are different classification of buildings based on which the parameters used to calculate the stamp duty and registration charges also differ.
In case of multi-storeyed apartments, the super built up area is used for calculating the stamp duty and registration charges. For plots, the square feet area of the plot is multiplied by the guideline value of the area, and in case of independent houses, the total constructed area is considered for calculating the total property value.
Calculations related to Stamp duty and Registration charges
The guideline value, more commonly known as guidance value, is the minimum value at which a property can be registered. It is decided by the respective State governments and differs from one area to another in a city. While registration charges are mostly fixed, stamp duty in Bangalore can change from time to time, with the Karnataka government revising them mostly annually. However, unlike in other States like Haryana and Rajasthan, these charges in Karnataka are the same for both men and women. These charges are primarily dependent on the existing market rate of the property, the expansion of the city limits and the property market performance.
Saleable Value = Size of property x Guidance Value
Registration charges = 1 per cent of Saleable Value
Stamp Duty = 5.6 per cent in Urban areas and 5.65 per cent in Rural areas of Bangalore
Total cost of the property = Saleable value of the property + Stamp duty + Registration charges
Let us take the instance of a property which measures 2,000 sq. ft. in an area in Bangalore where the guidance value is Rs 5,000 per sq. ft. Hence,
The Saleable Value of this property = 2000 x 5000 = Rs 100,00,000
Registration charges = 1 per cent of 100,00,000 = Rs 1,00,000
Stamp duty in Urban areas = 5.6 per cent of 100,00,000 = Rs 5,60,000
Payment of Stamp duty and Registration charges
Stamp duty and registration charges in Bangalore are paid through the Karnataka State department of Stamp duty and Registration. Stamp duty can be paid through the following means:
a) Purchase of impressed stamps from treasury or authorised stamp vendors, OR
b) Purchase of adhesive stamps, OR
c) Payment to the government through payment of DD/ pay order issued by any nationalised bank/scheduled bank or challan, OR
d) Instrument (document) can be written on plain paper and the stamp duty can be paid through DD/ pay order issued by any nationalised bank/ scheduled bank or challan within two months of the date of execution of the instrument, and certified by the jurisdictional District or Sub Registrar.
Other important government charges
Service tax and VAT (value added tax): These two taxes are applicable only for an under-construction property. Service tax, as decided by the central government, is payable on services provided by the service provider. The service provider collects the tax from the consumer and deposits the same to the government. Effective 1st June 2015, the service tax is currently 14 per cent of the 25 per cent of the total agreement value for properties below Rs 1 cr or 2000 sq. ft. area in size. For properties exceeding or equal to Rs 1 crore or more than 2000 sq. ft. area, the service tax is 14 per cent of 30 per cent of the total agreement value.
VAT is decided by the respective state. According to the latest Karnataka Value Added Tax (Amendments) Act of 2012, VAT is charged at around 5.5 per cent of the construction-related services.
