What are the Registration & Stamp Duty Charges in Tamil Nadu?

stamp duty

The Chennai office of the land registration department is all set to implement the TN registration charges 2020. Whether it is E-stamping in Chennai, stamp duty for partition of property- these can be done in the offices of the registrar or sub registrar. 

Details of individual stamp duty and registration charges for all types of documents have been listed. Well, stamp duty charges and registration charges were the highest out of all the states in India, second only to Bihar. 

In a recent revision, however, the government of Tamil Nadu has taken note of the economic weakness in society especially after the successive lockdowns due to COVID-19 and have brought down the stamp duty and registration fee which was as high as a combined 11% to 6%. Applicants are requested to check on the portal www.tnreginet.net whether the discounted rates are temporary or whether these rates will prevail in the foreseeable future as well. 

Stamp duty and registration charges for various documents in Tamil Nadu 

Registration and stamp duty charges in Tamil Nadu are higher than those in most states. The stamp duty for sales, exchange or gift of property is 7% of the market value and registration charges are 4% of the market value of the property. 

Mortgaged Property- There is a mandatory requirement that property under mortgage must also be registered. Stamp duty on property under a simple mortgage is 1% of the borrowed amount subject to a limit of ₹40,000. Registration charges of property under a simple mortgage is also 1% of the loan amount but up to a maximum of ₹10000. The stamp duty on a mortgage of the property which the owner has in his or her possession is higher at 4% of the borrowed capital. The corresponding registration charges 1% of the loan amount up to a maximum of ₹2 lakhs.

Property under the agreement- There are different rates of stamp duty and registration fees for agreements. For a sale agreement, the registration charge is 1% of the token money given for the agreement. The registration charge is, however, 1% of the total consideration amount if possession of the property has already been given. For agreements relating to constructing a building on a plot, the stamp duty and registration charges are both 1% of the higher value out of the cost of construction or the cost of consideration made in the document. The stamp duty and registration fees on any type of cancellation document are ₹50 each.

Property under partition- There are stamp duty and registration fees for individual registration of property after partition. For a split of property between members of a family, the rate is 1% of the market value of the property for both. Though, there is a maximum limit of ₹25000 stamp duty for each partition and a maximum limit of ₹4000 registration fee for each unit of partition of the property. For partition among people who are not related, however, the stamp duty is 4% of the present valuation of separated shares and the registration fee is 1% of the market value of the separated shares.

Property with the power of Attorney- There are different stamp duty and registration fees for property under a power of attorney. In the case of a general power of attorney for the sale of immovable property, stamp duty is ₹100 and the registration fee ₹10000. In the case of a general power of attorney for immovable property given to a member of the family, the stamp duty remains ₹100 but the registration fee is ₹1000. In the case of a general power of attorney given for selling mobile property not considered immovable and for other purposes, stamp duty on this document is ₹100 and the registration fees ₹50. There is a fourth type of power of attorney which is given for the purpose of considering action on a property. The stamp duty on this is 4% of the consideration amount and a registration fee of 1% up to a maximum of ₹10000.   

Settlement -The next set of documents are settlements. For registration of a document of settlement among family members, there is a stamp duty of 1% of the market value of the property up to a maximum of ₹25000. The registration fee is 1% of the market value but up to a maximum limit of ₹4000 only. Documents of settlement in other cases attract a stamp duty of 7% of the market value of the property while the registration fee is 4% of the property’s market value. 

Registration of Deeds- The stamp duty on partnership deeds is ₹300 and the registration fee 1% of the capital invested. If a memorandum of title deeds is to be registered, the required stamp duty is 0.5% of the loan amount up to a maximum of ₹30000. The registration fee on the memorandum is 1% of the loan amount up to a maximum of ₹6000. 

Release– There are two kinds of release documents: those among family members and those among non-family members. In the case of release among family members who are coparceners to the property, the stamp duty and registration fees are both 1% of the market value of the property though with a limit of ₹25000 on the stamp duty and ₹4000 on the registration fee. In documents of release among members who are not related by family, stamp duty is 7% and registration fee 1% of the total market value of the property.

Lease Documents- Lease agreements of different types need to be registered and so requires the payment of stamp duty and registration fees. The stamp duty and registration fee are both 1% of the rent, fines and premium though there is a limit of ₹20000 on the registration fee. For leases up to 99 years, the registration fee remains at 1% of the rent with a cap of ₹20000 while the stamp duty is 4% of the rent plus any premium or fine. For lease agreements beyond 99 years, also known as perpetual leave, the registration fee is again 1% with a limit of ₹20000 while the stamp duty is 7% of the rent and any advance or premium.      

Stamp Duty and Registration charges for women in Tamil Nadu

There is no difference in the rate of registration fee and stamp duty on any kind of property for women. The rates are the same for men, women, and joint buyers in the state of Tamil Nadu.

Stamp duty and registration charges impact the price of a property

Let us calculate the effect of stamp duty and the cost of registration on the price of a property. If a person is buying a property that has a market value of ₹50 lakhs, the stamp duty at 7% of the market value works out to ₹3.5 lakhs. The registration charge of this property at 4% works out to ₹2 lakhs. 

The total cost of stamp duty and registration fees is ₹5.5 lakhs. Thus, the impact of stamp duty and registration fees is an 11% increase in the cost of the land. 

The registration charge for resale property in Tamil Nadu

The fee for registration for a resale property is 1% of either the market value of the property or the sale agreement value. The stamp duty remains the same at 7%. 

Tamil Nadu may make registration compulsory for joint Ventures

The fee for registration for joint ventures in Tamil Nadu is high at the rate of 7% of the market value of the joint venture. As registration of joint ventures was not compulsory in Tamil Nadu and most of the projects for commercial and residential buildings are joint ventures, most of these projects remained unregistered due to the high registration cost.

The Tamil Nadu government is debating whether to reduce the registration fee to 2% down from 11% while making registration of joint ventures mandatory. This will help reduce unauthorised construction and help revenue collection for the Tamil Nadu government.

Property registrations in Chennai amid COVID-19 

There was a dip in property registration due to the crippling effects of the COVID-induced Lockdown. There was an increase in property registration during August 2020 after the easing of restrictions. Additionally, 17,000 more properties were registered in Chennai alone as compared to August 2019.           

Record high registrations - October 2020

The day of October 29, 2020, was a memorable day for the Tamil Nadu land registration department. On that one day alone, a record collection of ₹123.35 crores was collected in the form of stamp duty and registration charges. 

The 575 offices of sub registrars across the state of Tamil Nadu together achieved 20,307 registrations for the month. This looked like a good recovery, and no one thought a devastating second wave would cripple the progress a few months later.

Will the state reduce the Stamp duty?

The deputy chief minister of the state of Tamil Nadu had a meeting with the Association of Real Estate Developers in India to reduce the combined 11% stamp duty and registration fees to 6%. This move is being sought as a relief for the people of Tamil Nadu who have still not recovered from the devastating effects of the floods in 2015 and the pandemic-driven lockdowns during 2020 and 2021. There had also been a request to keep the total stamp duty and registration fees down to 5% as an interim measure of relief till the end of March 2021. This was reportedly accepted and implemented by the government of Tamil Nadu.

The Government of Tamil Nadu gave relief to MSMEs by exempting the 0.5% stamp duty on loans availed under the Pradhan Mantri Atma Nirbhar Bharat scheme. There has been a proposal for providing 20% provisional loan to units with outstanding loans due to loss of operations on account of the lockdowns caused by COVID-19. 

As of June 2021, stamp duty for registration of property in Chennai is 7% of the market value of the property and registration fee at 1%. The rate is presently prevailing for both urban as well as rural property.

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Frequently Asked Questions (FAQ's)

Do I need to register the property taken by me on a lease?

Yes. You will need to register the property you have taken on lease. You will need to pay stamp duty and registration fees of 1% each on the rent and any premium that you have paid for the lease. The registration fee, however, has an upper limit of ₹20000.

How can I contact the land registry department in Tamil Nadu?

You can visit the portal of the Inspector General of Registration Services (IGRS) which is www.tnreginet.gov.in. You can send an email to [email protected] in case of any specific query. The site has answers to around 30 frequently asked questions. Please refer to these questions. If you have a complaint, you can call any of the numbers 9498452110, 9498452120 or 9498452130.

Can my family property be partitioned among family members who are not coparceners?

A legal partition of property among family members is only permissible when each member is a coparcener of the family. Each member has to prove his or her being a coparcener for his or her share of the property to be registered individually.

Do I need to register once again after the mortgage on my property is cleared?

Registration of the mortgage document is done individually. The mortgage document will automatically become null and void once the mortgage is paid up. You need not register again if your property is already registered.

Will I need to register my partitioned property in Tamil Nadu if three of us coparceners decide to combine our shares into one property?

You will need to register your shares as one property with three joint owners. If the three of you have registered your shares individually, you will need to combine the shares as one property.