Under section 55 of the income tax act – Stamp duty value means any value adopted by authority of the CG or SG for the purpose of payment of stamp duty for the immovable property
Stamp Duty
Stamp duty is a tax imposed on the sale of property/property ownership by the State Government
It is payable under section 3 of the Indian Stamp Act, 1899
The duration of the stamp duty at the time of registration shall be based on the value of the house/property
Why it is called stamp duty
Because a physical stamp is used on the document as proof that the document has been recorded and tax liability paid
Stamp duty liability
It is always the buyer who pays stamp duty, not the seller
The duty is thought to have originated in Venice in 1604, being introduced (or re-invented) in Spain in 1610s, the Netherlands in the 1620s, France in 1651, Denmark in 1657, Prussia in 1682, England in 1694, India 1899
Stamp Duty Charges in Maharashtra from 01/04/2021
Mumbai – 5% (includes 1% metro cess)
Pune, Thane, Navi Mumbai, Pimpri-Chinchwad, Nagpur – 6%(includes local body tax and transport charge)
The registration charges in the state are 1% of the total cost, for the properties priced below Rs 30 Lakhs and capped at Rs 30,000 for the properties priced above Rs 30 lakhs
Stamp duty on gift deeds is 3% of the property value
However, if the property in consideration is the residential or agricultural property and is gifted (without any payment) to family members, then the stamp duty is Rs 200
If the historical documents are liable to be stamped, the stamp duty shall be recovered only at the market rate prevalent when the transaction took place
Stamp duty charges cannot be applied on a retrospective basis
Bombay HC rules stamp duty cannot be charged for past transactions
Stamp duty on lease agreements
In Maharashtra, leave and license agreements are required to be stamped, with a flat stamp duty rate of 0.25% of the total rent for the period
In case any non-refundable deposit is also paid to the landlord, stamp duty at the same rate shall be charged on such as well
Refund of stamp duty
Buyer can claim the refund of stamp duty paid if the same has not been executed
The government deducts 1% Od the stamp duty, subject to a minimum of Rs 200 and a maximum of Rs 1000 of the stamp duty paid
Stamp duty exemption from income tax
Stamp duty is tax-deductible under section 80C of the income tax act 1961
Stamp duty rebate in income tax can be a huge sign of relief
The exemption from stamp duty can be availed if it is paid in the same financial year
Stamp duty refund claim should be processed within 15 days after submission of relevant information
You could be entitled to any interest due on the refund, but you will not be able to file for compensation
Stamp duty refund for sale of a second home
Buyers are entitled to a stamp duty refund if they have bought a second home, and paid the 3% additional property stamp duty charge, but gone on to sell their original property within three years
In Maharashtra, if the buyer is a woman, 1% less stamp duty from 01/04/2021 onwards
Loan for stamp duty
You can take loan for stamp duty, you will have to take this into consideration while applying for a mortgage, along with the affordability checks
Applicability of stamp duty in Maharashtra
The Bombay stamp act 1958 came into force on 16/02/1959 and is applicable in the state of Maharashtra
Importance of payment of stamp duty
The payment of proper stamp duty on instruments bestows legality on them, such instruments get evidential value and are admitted as evidence in the court of law
For the purpose of determination of true market value, the built-up area is considered
(not carpet, super-built up or salable built-up area)
Stamp duty payment basis
Stamp duty has to be paid on True Market Value or on the amount of consideration mentioned in the document whichever is higher
Documents executed out of India
When a document is executed outside India, then it has to be presented for registration within four months after its arrival in India on payment of the proper registration fee and the registering officer on satisfaction shall accept such document for registration
Place of registration for stamp duty
Sub-Registrars office
Stamp duty for trademark
The market value of the trademark
Stamp duty – Copyright
Instruments relating to the sale of copyright under section 18 of the Indian Copyright Act 1957 are specifically exempt from stamp duty
Power to reduce stamp duty
Section 9 – Government can reduce or remit whole or part of stamp duty payable
Foreign Bill Stamp
Foreign bill stamp is a special adhesive stamp bearing the words Foreign Bill
Such kind of stamp is generally used in case of bills of exchange and promissory note drawn out of India
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