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If you plan to buy a real estate property, you must know the related legal factors to avoid any legal battle or hustle. Stamp duty and registration fees play a pivotal role in the legalities of real estate property. When you are paying both these taxes, it means you are becoming an official owner in the eyes of the government. Here it is important to mention that under section 3 of the Indian Stamp Act, 1899, and the Registration Act 1908, the state government collects and makes regulations regarding both payments. Hence, the laws can vary based on the state you are investing and if you are buying a property in West Bengal, you must know the state government’s laws. In today’s blog, we will elaborate on everything related to stamp duty and registration fees in West Bengal.

Let’s start!

What are Stamp Duty and Registration Fee on Property?

Many times, many buyers get confused between stamp duty and Registration Fee on Property and use these terms interchangeably. However, it is not right. It is right that both apply to buying a real estate property, they are not the same.

The stamp duty is a tax that you must pay at the time of buying a real estate property or, any other legal documents, such as sale deeds, gift deeds, and mortgage deeds. The stamp duty depends on the location, age, and carpet area.

On the other hand, the Registration Fee on Property is the charge or tax that you have to pay to register the owner’s name in the government register.

As mentioned the amount of stamp duty (percentage based on transaction value) varies on location and other factors, here is a brief view of the factors that control the stamp duties of any property.

a. Location:

To fuel the rural real estate industry, the government of West Bengal charges lesser stamp duty in the rural areas than in the urban area. For example, if you buy a 1 crore property in a rural area you must pay 3% of the property value as stamp duty. On the other hand, for the same valuation property in an urban area, you will be required to pay 4% of the valuation as the stamp duty.

b. City:

West Bengal consists of various cities such as Howrah, Kolkata, Durgapur, etc., and each city has different own stamp duty rates. For Howrah and Kolkata, you have to pay the highest amount as it is the closest to the most urbanized areas of the state, and for the rest, you might need to pay less depending on the property area or type.

c. Property Type:

Stamp duty varies depending on the property type like residential or commercial. For a residential property located in Kolkata and Howrah valued below 25 lakhs, the buyer will be required to pay 6% of the property valuation, and if you acquire a property outside of Howrah and Kolkata, 5% of the property valuation is payable.

d. Property Valuation:

Just like the location and property type, the stamp duty amount varies on the valuation of the property. For example, for a property cost below 25 lakhs, the stamp duty is (in Howrah and Kolkata) 6% while if it crosses the 40 lakhs the percentage will be 7%.

e. Nature of the Property Transaction:

Based on the type of transaction, the stamp duty varies. For example, if you are buying it in your name or someone else’s name you must pay the above-mentioned percentages while if you do it as a gift deed (sale deed as gift deed) to a family member you must pay 0.5% of the property’s market value while for a non-family member, the percentage is 5% to 6% depending on location (panchayat and municipal area).

f. Property Area:

Stamp duty in West Bengal is decided on the carpet area, not on the super-built area. The super-built area includes common spaces like a community area or garage. Hence, it is confusing. If you buy a 1 BHK flat, you are required to pay less than a 2 BHK property.

Please note that the registration fee is the same for all the kinds of properties in West Bengal and female home buyers do not enjoy any rebate in West Bengal. They need to pay the same charge as their male counterparts.

Here is a view of the stamp duty of West Bengal depending on location.

Stamp duty is one of the significant income sources for any state government and increases the price of the property. Many times, many buyers take a step back from buying their dream property due to higher stamp duty.

To reduce this tendency and fuel the sector after the worst hit of the pandemic, the state government of West Bengal revoked the temporary 2% stamp duty rebate and a 10% reduction in the circle rate.  The government announced this offer on October 30, 2021, and extended till June 30, 2024.

Just like the location (urban and rural), the city also plays a crucial role in deciding the stamp duty amount.

Stamp duty in Top Cities of West Bengal:

As many factors control stamp duty and control the overall budget, every buyer needs to calculate it before looking for a property. For that, follow the below-mentioned steps:

#1: Visit the site of the government of West Bengal (the site link is-  https://wbregistration.gov.in )

#2: On the registration page you must tap on the ‘E-services’ tab and then click on ‘Calculator for MV, SD & RF’.

#3:  Right after clicking on the ‘Calculator for MV, SD & RF’, there will be four options for you and among them, you must choose the ‘Stamp Duty and Registration Fee’ option.

#4: Then you will be directed to a page and you have to fill up a form-like page. There will be options like Transaction Major, Transaction Minor, Local Body, and Market Value. Fill it up and you will receive the payable amount of your stamp duty and registration fees.

Here, it is important to inform you that you can pay these taxes online and offline mode; and you can get a refund in case of any issues.

Another major thing is to remember that you must pay stamp duty for every kind of property. Only the government does not need to pay any stamp duty for their real estate purchases.

Given this, keep the below-mentioned pointers in mind:

• All the properties must be stamped before registration or right after one day of it
• The stamp paper must be issued after or within six months of the transaction
• The stamp must contain the names of the buyer and seller

Wrapping Up-Registration Fee on Property :

Stamp duty and registration fees are must-have when you are buying or selling any real estate property. It controls the legalities of the property. If you buy a property from Vinayak Realtech, you will not be required to visit the government site to know the percentage. They help with this and do everything on behalf of their consumers to meet the goal of 100% customer satisfaction.

What are you thinking about? Connect with Vinayak Realtech, choose from their wide range of projects in Newtown, Rajarhat area and book now!