Buying a new home might sound magical but the process is hectic. Finding the right property and the added paperwork for loans and government formalities are a tiresome job. Most of the new homebuyers are often confused regarding the overwhelming requirements and formalities that have to be done. One such important part of this venture is the stamp duty that a homeowner has to pay to the government as a tax.
What does stamp duty stands for?
It can be considered as a property tax paid to the government once the ownership of the property is changed. It is almost similar to that of the sales tax a person pays when something is bought from a store. The valuation of the duty depends on the cost of the property and various other factors.
A sale agreement of real estate properties, for which you have paid stamp duty, becomes legal evidence. This evidence can be presented in a court when any dispute occurs. After the proper mutation of the property, this documentation will ensure that you are the present owner of a particular property. Once you pay stamp duty, the information will be automatically recorded and maintained by the government.
How it is calculated?
Stamp duty varies from place to place. It also depends on other factors such as:
Property status
The value of the stamp duty will depend on the age of the property. If it is brand new or old, the value will vary.
Location
The location of the property also decides the stamp duty the future owner has to pay. It depends on whether the property is in an urban area, suburban, or in a rural area.
Owner’s age
In some states, the owner might enjoy a discount based on his age.
GenderÂ
Female owners can enjoy a discounted value on the stamp duty. Females are subjected to concessions from the government.
Property usage
The stamp duty price will depend on the usage of the property. The rates vary depending on whether the property is used for commercial or residential purpose.
Property type
The value of the stamp duty will depend on the type of the property. Whether it is an independent house or an apartment, the stamp duty value will vary accordingly.
How it is paid?
As per the official rules and decorum, there are three registered ways to pay stamp duty to the government.
E-stamping
The digitalization of the government processes has made it very easy for the homebuyers to pay the stamp duty. This is a very secure medium to pay stamp duty and there is no chance of tampering the evidence. The electronic process is way better than the manual processes.
All you have to do is to enter the official online portal www.shcilestamp.com. This website belongs to Stock Holding Corporation of India Limited. After filling the specific information on the website, you will have to pay the amount via RTGS or NEFT. If you want a physical receipt of the transaction, visit a local SHCIL office and deposit a cheque, cash or DD with the name of SHCIL on it.
Franking
This is a different approach where the agreement terms are mentioned or printed on a paper and then submitted including the stamp duty cost in a bank. This bank should be authorized by the governing bodies for carrying on franking transaction. A special stamp has to be bought. The valuation of the stamp is similar to that of the duty cost. The bank then fixes the stamp to the document via a franking machine and charges the fee for its service.
Non-judicial stamp papers
This is by far the most prevalent stamp duty payment method. In this case, the pertaining details of the agreement are mentioned via handwritten or printed way on a non-judicial stamp paper physically. The paper must be purchased from a licensed vendor. The stamp papers will have to be purchased with the value similar to the duty. The stamp papers will be signed properly to make it a proper proof of ownership.
Final words
The stamp duty payment is the absolute certification that the property belongs to the owner. When needed, this documentation can be presented as solid proof to solve any dispute.
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