Stamp Duty & Registration Charges in Mumbai, Maharashtra

The state government imposes stamp duty on the sale of property/property ownership. It is payable in accordance with Section 3 of the Indian Stamp Act of 1899.

The stamp duty period at the time of registration will be determined by the value of the house/property. It also varies depending on whether the property is new or old, as well as the state or area in which it is located.

Stamp duty is an additional cost you will incur when purchasing immovable property, and it is therefore critical to understand the implications for the nature and location of the house you intend to buy.

What is Maharashtra Stamp Act

The Maharashtra Stamp Act, enacted in 1958, applies to all instruments listed in Schedule 1 on which the state collects stamp duty. The Act was recently amended, and the changes include a revision of stamp duty on gift deeds, the inclusion of e-payment of stamp duty, a revision of penalty clauses, and an increase in stamp duty under certain instrument clauses.

Stamp Duty is a tax levied by each state's government on all authorized property transactions. A stamp paper that must be purchased in either the seller's or the buyer's name is valid for six months if the stamp duty is paid on time.

To put it simply, any type of property document is only legal if the stamp duty is paid. The registration fee is an additional tax on top of the stamp duty. It is usually levied so that the state government can cover the costs of running the registration offices.

Stamp duty rates on property in Maharashtra are determined by a number of factors. This includes things like whether the property is in an urban or rural area, the total cost of the transaction, and so on.

Previously, in April 2020, the Maharashtra government reduced stamp duty on properties in the Mumbai Metropolitan Region Development Authority (MMRDA) and municipal corporations of Pune, Pimpri-Chinchwad, and Nagpur for the next two years. This means that stamp duty on properties in Mumbai, Pune, and Nagpur was charged at 5% (4% stamp duty + 1% metro cess).

Stamp Duty in Mumbai, Maharashtra

Stamp duty in Mumbai varies depending on the location of the property and the type of deed.

  • 5% of the market value is charged if the asset is within the municipal limits of any urban area
  • Within the boundaries of any municipal council/panchayat/cantonment of any MMRDA area, 4% of the market value is charged
  • Within the boundaries of any gram panchayat, 3% of the market value will be charged

Below is the table to summarise the stamp duty charges on conveyance/sale deeds after March 2021:

Mumbai Stamp Duty Charges
Inside the municipal limits of any urban area 5% of the market value
Within the limits of any municipal council or panchayat or cantonment of any area within MMRDA 4% of the market value
Inside the limits of any gram panchayat 3% of the market value

Property Registration Charges in Mumbai

While buyers must pay 1% of the property cost as a registration fee on properties worth more than Rs 30 lakh, the registration fee for properties worth less than that is capped at Rs 30,000.

Because Mumbai is one of the most expensive property markets in the world, buyers must consider all ancillary costs before proceeding with a property purchase plan.

The stamp duty in Mumbai and registration fees, for example, add significantly to the cost of a home. As a result, buyers must be aware of the amount of money that must be paid during the property registration process.

Assume you are purchasing a property with a carpet area of 800 square feet in an area where the RR rate is Rs 5,000 per square foot. The property's RR-based value is 800 x 5000 = Rs 40 lakhs.

If the property is worth Rs 40 lakhs, the buyer must pay 2% of that amount in stamp duty, or Rs 80,000.

If the property is registered for less than that amount, the buyer must still pay 2% of Rs. 40 lakhs in stamp duty because the property cannot be registered for less than the RR rate.

If the property is valued at Rs. 50 lakhs, the buyer must pay a stamp duty of 2% of the value of the property, or Rs. 1 lakh.

Stamp Duty in Pune

The calculation for stamp duty and registration charges in Pune is based on the following guidelines –

  • If the owner is a male the stamp duty charges are 6% (Stamp duty 4% + Local Body Tax (LBT) 1% + Transport Surcharge 1% ) and the registration charges would be
    • For properties worth more than Rs. 30 lakh – Rs. 30,000.
    • For properties worth less than Rs. 30 lakh, the fee is 1% of the property's value.
  • If the owner is a female, stamp duty will be 6% (Stamp duty 4% + Local Body Tax (LBT) 1% + Transport Surcharge 1% ) and the registration charges would be
    • For properties worth more than Rs. 30 lakh – Rs. 30,000.
    • For properties worth less than Rs. 30 lakh, the fee is 1% of the property's value.
  • If the property is jointly owned by Male & females, then the stamp duty would be 6% (Stamp duty 4% + Local Body Tax (LBT) 1% + Transport Surcharge 1%. The registration charges
    • For properties worth more than Rs. 30 lakh – Rs. 30,000.
    • For properties worth less than Rs. 30 lakh, the fee is 1% of the property's value.

Payment of Stamp Duty

The Maharashtra Stamp Act requires that all instruments chargeable with duty and executed in Maharashtra be stamped before or at the time of execution, or on the next working day after the date of execution. However, if the deed is executed outside of the territory, it can be stamped three months after it is received in India for the first time.

The stamp papers must be in the name of one of the transaction's parties and not in the name of the parties' chartered accountant or lawyer. Furthermore, the stamp paper's issue date cannot be more than six months older than the date of the transaction.

Stamp duty can be paid on the deed with adhesive or impressed stamps. Furthermore, the adhesive stamps used on the deed are canceled at the time of execution, making them unusable to avoid reuse.

Conclusion:

Following the announcement of a significant reduction in stamp duty rates in August 2020, the state government has decided not to extend the stamp duty waiver on property registrations beyond March 31, 2021, and has also kept the Ready Reckoner Rates unchanged for the fiscal year 2021-22.

The state government announced in August 2020 that the stamp duty payable on property transactions would be reduced in two tranches: by 3% from September 1, 2020, to December 31, 2020, and by 2% from January 1, 2021, to March 31, 2021.

Previously, the Maharashtra government announced in its budget for 2021-22 in which a 1% reduction is done in the current stamp duty rate on property transactions if the transfer of house property or registration of sale deed is done in the name of a woman.