The state tax that turns a property agreement into a legally recognized document of ownership.
Definition of Stamp Duty in Real Estate
Stamp Duty is a tax paid to the state government when a property is registered in your name. It legally validates the ownership transfer between the buyer and seller. The amount is calculated as a percentage of the property’s market value or Ready Reckoner Rate, whichever is higher. Rates differ across states and may vary for men, women, and joint ownerships. Without stamp duty payment, the sale deed holds no legal weight in a court of law.
Why It Matters
Stamp Duty is a crucial step in the buying process because it:
- Confirms legal ownership of the property
- Makes your sale deed admissible as evidence in disputes
- Determines the total purchase cost alongside registration fees
- Supports government revenue for infrastructure and civic services
Skipping or underpaying stamp duty can result in heavy penalties and delay registration.
How It Works
- Calculation: Based on the property’s market value or Ready Reckoner Rate
- Payment: Made through e-stamping or stamp papers before registration
- Rate variation: Typically between 4% to 7% depending on the state, property type, and gender of the buyer
- Verification: The sub-registrar office checks proof of payment before completing the registration process
In cities like Bengaluru, stamp duty for affordable housing is often lower to encourage first-time buyers.
How BrickFi Uses This
Transparency from registration to returns. BrickFi factors stamp duty and registration costs into its total cost calculations.
- The Brick360 Report breaks down these statutory costs for each project
- The Investment Score adjusts expected yield and ROI after including transaction expenses
This gives buyers a real picture of what ownership truly costs.
Buyer Action
Steps before paying stamp duty:
- Verify your state’s latest stamp duty rate and concessions
- Always pay using authorized government channels or online portals
- Keep the e-stamp certificate or receipt securely with the sale deed
- Ensure stamp duty matches the property’s declared value to avoid penalties
Related Terms
Ready Reckoner Rate | Agreement to Sale | Brick360 Report | Investment Score
Key Takeaway
Stamp Duty is not just a tax; it is the legal foundation of your ownership. Paying it correctly safeguards your rights and ensures the transaction is recognized by law.
Where BrickFi Comes In
BrickFi simplifies cost transparency by showing total ownership expenses upfront, including stamp duty and registration. With clear comparisons and verified data, you always know the real price behind your purchase.
