These are a few great ways to reduce the peripheral costs associated with buying a home, as your home loan does not cover the registration and sale fees. So use these entries when you buy your property and read more uplifting tips only on MyMoneyMantra. If you get home credit to buy a new home, you`ll have to pay an additional fee, namely stamp duty and registration fees. The amount of the housing loan, sanctioned by the bank, is generally without stamp duty and without registration fees. You must pay these additional fees to get ownership of your new home. Stamp duty What is stamp duty? Stamp duty is a tax levied on any type of transaction that takes place and is documented. These may include a deed of transmission, a deed of sale, a power of attorney, etc. Stamp duty confirms the registration of the property on your behalf. It also legalizes the ownership document in your name. Why do you have to pay stamp duty? The government handles all real estate purchase transactions in India. Once you have paid the stamp duty, your name will be registered by the government. Stamp duty is proof that the property is legally registered under your name. Therefore, if disputes arise in the future, your home purchase agreement will serve as legal proof after payment of stamp duty.
If the person refuses to pay stamp duty, they are not considered the legalized owner of that particular home. How is stamp duty calculated in India? Stamp duty depends on the value of the property. Stamp duty is not levied on the persons involved in the transaction, but on the agreement. It also depends on the type of property, i.e. residential or commercial real estate. The stamp tax authorities of each state refer to the Stamp Duty Ready Reckoner to assess the market value of homes. The government issues market values on January 1 of each year. What are the factors that influence stamp duty? Stamp duty varies from state to state. The following factors influence the level of stamp duty. Stamp duty and registration fees, as well as the purchase of a house, represent a considerable effort. You must pay 5% -8% of the value of the property as stamp duty and registration fees. However, if you receive your home financing with a home loan, the home registration fee is not part of a home loan.
You pay these fees before benefiting from a mortgage. However, you can claim tax deductions up to section 1.50,000 on stamp duty and registration, in accordance with section 80C of the Income Tax Act. The registration fee is a fee that you must pay beyond stamp duty to register the property in your name. The tax is usually calculated with 1% of the total cost of the property or its market value, depending on where you buy the property….