Stamp duty and registration charges in Pune

In a move that would incentivise property purchases by women home buyers in Maharashtra, the state government, on March 8, 2021, announced a 1% concession on stamp duty for this category. This means, women home buyers in Pune can register properties in their names, by paying only 2% of the property value as stamp duty in Pune.

“On International Women’s Day, I propose a concession in stamp duty of 1% over the prevailing rate, exclusively for women, provided the transfer of house property or registration of sale deed is in the name of a woman or women only,” state finance minister Ajit Pawar announced, while presenting the Budget for 2021-22.

In 2020, the state government had, in view of the Coronavirus pandemic, cut the stamp duty on housing units from 5% to 2% until December 31, 2020. From January 1 to March 31, 2021, the charges were reduced to 3%. During the period for which the stamp duty reduction remained in effect, housing sales increased month-on-month in the state, including Pune.

However, the old and levy has now been restored, after the expiration of the period (up to March 31, 2021) for which the state government had extended this benefit to home buyers.

The real estate community has, however, urged the state to continue the support measure. “It would have been a great move, if the government would have extended the stamp duty benefit for a couple of quarters more, to keep the sales momentum going . On behalf of NAREDCO and the real estate fraternity, we would sincerely urge the government to reconsider their decision in favour of the real estate sector,” said Ashok Mohanani, President, NAREDCO Maharashtra.

Pritam Chivukula, secretary, CREDAI MCHI, added: “The industry is not out of the crisis situation yet, as we see a rise in Coronavirus cases and a fear of yet another lockdown in the state. We will continue to urge the government to reconsider their decision and extend the stamp duty benefit further, in interest of the home buyers.”

What is stamp duty?

Stamp duty and registration charges are two additional costs that buyers in have to bear, during property purchase. Paid to the government at the time of registration, payment of these charges is compulsory under the provisions of the Registration Act, 1908.

Recall here that stamp duty is a percentage of the property value that the buyers are liable to pay, for registration. Fixed by the state government, the stamp duty Pune is periodically revised to boost or curb demand. In a slow-moving market, rates are tweaked downwards to push up demand.

With this primary reason, the Maharashtra government, in August 2020, announced a temporary reduction of 2% to 3% in the stamp duty on property purchases. The move is likely to result in savings for buyers, at a time when demand for housing has been muted, because of the Coronavirus pandemic. “It was decided to reduce the prevailing stamp duty on the deed of transfer by 3%, for the period from September 1, 2020 to December 31, 2020 and by 2% for the period from January 1, 2021 to March 31, 2021,” a notification by the state government read.

In March 2020 too, the Maharashtra government, while presenting the Budget for 2020-21, announced a reduction of stamp duty in Mumbai, Pune and Nashik for a period of two years, bringing it down to 5% from the earlier 6%.

Stamp duty and registration charges in Pune till December 31, 2020

Since the reduction in stamp duty is of 3%, from September 1 to December 31, 2020, the applicable stamp duty on property purchases in Pune will come down to 2%, from the existing 5%.

The temporary reduction in stamp duty, has helped the city clock better sales during the October-December period in 2020. Data available with Housing.com show that home sales in Pune during the three-month period increased by 62% with transactions concluding for 11,548 units.

“In Pune, sales have nearly doubled compared to the previous quarter, with increased demand during the festive months of October and November. We expect sales to show further improvement, as buyers make hurry to avail of the benefits of the current low-interest rate regime and reduced temporary reduction in stamp duty,” says Dhruv Aharwala, group CEO, Elara technologies.

Stamp duty and registration charges in Pune from January 2021 to March 31, 2021

Since the reduction in stamp duty is 2% from January 1, 2021 to March 31, 2021, the applicable stamp duty on property purchases in Pune will come down to 3% from the existing 5%.

The Maharashtra government’s move to reduce the stamp duty in order to boost sales, has been instrumental in providing an impetus to the real estate market of Pune, which has been reeling under the impact of an acute rise in the number of Coronavirus infections. Apart from this, the festive offers that primarily focused on offering cost benefits to home buyers, have also played a key role in boosting sales in the city during the October-December period of 2020, shows Real Insight Residential Annual Round-up 2020, an analysis of India’s eight prime residential markets by brokerage firm PropTiger.com. With transactions concluding for 11,548 units, home sales in Pune increased 62% quarter-on quarter.

Stamp duty and registration charges in Pune from April 1, 2021

Since the reduction offered will be applicable only for seven months, the standard stamp duty rate will be reinforced from April 1, 2021.

Do note here that with an aim to reduce chaos and help home buyers make the most of the low stamp duty regime, the state government has decided that home buyers can pay the stamp duty fee till December 31, 2020, at 2% and register their properties by April 2021.  According to the state’s stamp duty and registration office, a lot of people are buying properties due to the 2% stamp duty offer, resulting in a long waiting period at counters. The decision has been taken to deal with this issue.

Stamp duty for women in Pune

Unlike other states, where the stamp duty is lower for women, rates used to be the same for men and women in Maharashtra, till the state announced a one-percentage-point concession for the fairer sex, on March 8, 2021. Now, property can be registered in the name of the women, by paying 2% stamp duty.

Check out price trends in Pune

How to calculate stamp duty in Pune?

Buyers have to pay the rate fixed on the overall value of the property. However, to arrive at the property value, the buyer must first find out the circle rate in the area in which the property is located.

What is ready reckoner rate?

The ready reckoner rate (RR), as it is known across Maharashtra, or the circle rate, is the government-fixed rate, below which a property cannot be sold in an area. In a scenario where the seller has priced the property at less than the government-fixed ready rates, the stamp duty calculation will still be based on the RR rates.

By multiplying the circle rate with the area of the property, the buyer can calculate the value of the property and then calculate the stamp duty.

Example

Suppose Ram Kumar is buying a home which has a carpet area of 300 sq metres. The property is at Baner, where the circle rate is Rs 42,760 per sq metre. In this case the overall value of the property will be:

Carpet area x rate per sq metre = Property value

400 x 42,760 = Rs 12,828,000

Considering the stamp duty in Pune at 5% of the property value, Kumar will have to pay Rs 6,41,400 as stamp duty. Since the property’s worth is over Rs 30 lakhs, Kumar will be paying an additional Rs 30,000 as the registration charge.

See also: Top localities in Pune for buying or renting property

Can you pay stamp duty online?

Buyers in Pune can pay the stamp duty and the registration charges online, by visiting the official portal, (click here).

Once you have registered yourself, you can proceed with the payment. For this you will have to provide every detail pertaining to the property and pay using online channels, such as internet banking. A receipt will be generated once the payment is successful. After this, the buyer can book an appointment and proceed with the property registration.

Alternatively, buyers can also pay the stamp duty in Pune by purchasing non-judicial stamp papers from a recognised vendor or through franking, where authorised banks stamp your document or affix a denomination on it, which acts as a proof that the stamp duty for the transaction has been paid.

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