Stamp Duty Registration Charges in Bangalore

A buyer must pay various taxes in addition to the amount paid to the seller in order to legally acquire the property. Stamp duty and registration fees are the most common types of costs that are imposed.

These charges are mandated by the government under Section 3 of the Indian Stamp Act of 1899 and are collected to authenticate the sale agreement as well as to keep a record of the property. All fees are set by the state government, and thus vary by state.

In the following sections, we'll go over how much money you'll have to pay in stamp duty and registration charges in Karnataka’s capital city, Bangalore. 

Stamp Duty and Registration Charges in Karnataka

Let us first look at the amount charged with respect to the types of fees:

Registration charge - 1% of the property value

BMRDA, BBMP, and village areas added cess - 10% on stamp duty

Corporation and BBMP added surcharges - 2% on stamp duty

BMRDA and other charges - 3% on stamp duty

In Bangalore, unlike in the majority of other Indian states, stamp duty is the same for women and men.

Stamp Duty in Karnataka

In an effort to stimulate the property market, the Karnataka government reduced the stamp duty in Bangalore from 5% to 3% for properties priced between Rs.21 Lakh and Rs.310 Lakhs in May 2020.

For properties worth up to Rs.20 Lakh, the stamp duty was reduced from 5% to 2% in 2019. To address the concerns of those looking for property priced above Rs.310 Lakhs, homebuyers have asked for a 3% flat stamp duty charge on all properties above Rs.21 Lakh.

The stamp duty and registration charges in karnataka on homes worth under Rs.310 Lakhs were reduced recently. You must pay 5% of the whole or registered property value (above Rs.410 Lakhs) in stamp duty and 1% of the total or registered property value in registration fees in accordance with current rates.

Stamp Duty and Registration Charges in Bangalore with Example

Let us look at an example to understand if the reduction in stamp duty has made buying a property in Bangalore affordable.

Let’s assume that a property costs Rs.40 Lakh and the stamp duty is 5%, which works out to Rs.2 Lakh resulting in the overall cost rising to Rs. 42 lakh. With a 3% stamp duty, the amount would be Rs.1.20 Lakh only which means that the cost would be Rs. 41.2 lakh. This indicates that a reduction in the stamp duty rate lowers the overall cost of owning a property.

However, a reduction in stamp duty is insufficient to make homeownership affordable. According to a study by IIM Bangalore, the registration fees have to be reduced as well.

Stamp duty and registration fee reductions are frequently feared by authorities as a threat to the government's revenue. However, according to a study conducted by the National Housing Bank, such reductions encourage those looking for low-cost housing to purchase the property.

As many more units were built under the Housing For All scheme, these charges were usually paid by buyers of land or built property and range between 5% and 13%. It generated additional revenue and compensated for any revenue loss due to stamp and registration fees.

Stamp Duty Surcharge in Bangalore

In addition to stamp duty, you will need to budget for the cess and surcharge, as mentioned in the section above. 

A 10% cess and a 2% surcharge apply to properties priced above Rs.310 Lakhs. This is also valid in the case of cities and urban areas. As a result, you will have to pay 5.6% in stamp duty. Because the surcharge is 3% in rural areas, a home buyer pays 5.65% as stamp duty.

How to Calculate Property Registration Charges in Karnataka?

Here is a step by step procedure to calculate the registration charges for your property in Bangalore - 

Step 1: Go to the Kaveri Online Services website and fill in the nature of the document to continue. In this case, choose the nature of the document to be "Sale of Flat".

• Step 3: Enter property information such as region type (BBMP, city corporation, municipal corporation, town panchayat, gram panchayat, or others). You can select this option from the drop-down menu.

Some other details that you will have to mention are the indicative market value and the indicative consideration amount.

The market value is the value calculated as per the consideration (or ready reckoner, or stamp duty) mentioned in the document, whichever is higher, to arrive at the stamp duty rates and charges. If the consideration value is greater, this will be considered when calculating stamp duty.

If you are unsure of the market value, you can calculate it now using the provided calculator. To proceed, simply click on the ‘Calculate market value' button.

Once you've entered your information, the calculator will display the estimated stamp duty charges, surcharge, cess, total stamp duty, and total registration fees for your property.

Factors Determining Stamp Duty Charges

Let us take a look at the factors determining stamp duty charges:

• The age of the property - Because stamp duty is calculated on the total value of the house or property, the age of a specific property is important in determining stamp duty charges. This is due to the fact that older properties are typically less expensive than newer properties.
• Age of the property owner - In most states, senior citizens pay a lower stamp duty charge. As a result, the age of a property owner is important in determining stamp duty charges.
• Gender of the owner - In India, women typically pay a lower stamp duty fee than men. Men end up paying roughly 2% more than women.
• The purpose of the property - Commercial properties typically attract a higher stamp duty fee than residential properties. This is because commercial buildings typically require far more amenities than residential buildings.
• Property location - The stamp duty fee payable by an individual is also determined by the location of the property. A property located in an urban area is subject to a higher stamp duty than a property located in a rural or suburban area.
• Amenities - The number of amenities provided by a property determines the stamp duty fee. A building with more amenities necessitates a higher stamp duty fee, whereas a building with fewer amenities necessitates a lower stamp duty fee.