Stamp duty for property sales in Kerala (2014 budget proposals)
The following are the mandatory fees for land registration in Kerala:
Stamp duty: 6% of sale value(proposed value in 2014 budget)
Registration Fees: 2% of sale value
Documentation fees: This is the fees you pay to the document writers and the charges depends on the writers. You may want to negotiate the price before you start the documentation process.
Depending on your case, you may have the following additional expenses:
1. Fees for your realtors/brokers: The fees charged by brokers vary from 1% to 3% of the market value. In many parts of Kerala, the buyer has to pay 1% and seller has to pay 2% of the sale value. In certain areas like Ernakulam, Kakkanad, Kalamassery etc, the buy is not obligated to pay any broker fees. Instead, the seller is responsible for the entire fees (up to 3%). In many cases, the buyer/seller will negotiate a smaller fees, especially in case of sales for large amounts, above 50 lakhs. Some sellers/buyers would even negotiate for a fixed realtor fees, irrespective of the value of the property.
2. Fees for obtaining documents like encumbrance certificate.
3. Payment of all pending taxes and fees for the property.
4. Pending fees for residents' associations to which the property belongs.
5. Buyer may have to pay a membership fee for the residents' association
The proposed stamp duty for all land registrations in panchayats, municipalities and corporations are 6% of the sale value.
The stamp duty for selling land as per the existing rules are as follows (pre-budget 2014):
Panchayats: 5%
Municipalities: 6%
Corporations: 7%
(Before 2011, the stamp duties were 7, 8, 9% respectively. Govt announced a 2% deduction in 2011 for the respective sectors, which made it 5%, 6% and 7% for panchayats, municipalities and corporations respectively.)
As per the new budget proposals, government will unify the stamp duty to 6% for all sectors. This means a 1% increase for all land/property sales in the panchayats and 1% reduction in the corporation areas.
The stamp duty is calculated based on the actual sale value of the property. However, it is required that the sale value cannot be lower than the "fair value" of land, as determined by the government. The existing fair value of land in Kerala was fixed in 2010, which will be revised as per the current budget proposals. Government will introduce necessary amendments to the Govt Stamp Act to enable these changes.
For family property partitions, the stamp duty is fixed to Rs 1,000, irrespective of the value of the land. There are no changes proposed for family property partition and gifting of land for immediate family members. For this purpose, the immediate family is defined as wife, husband, children, brothers, sisters, children and grandchildren.
The stamp duty for selling land as per the existing rules are as follows (pre-budget 2014):
Panchayats: 5%
Municipalities: 6%
Corporations: 7%
(Before 2011, the stamp duties were 7, 8, 9% respectively. Govt announced a 2% deduction in 2011 for the respective sectors, which made it 5%, 6% and 7% for panchayats, municipalities and corporations respectively.)
As per the new budget proposals, government will unify the stamp duty to 6% for all sectors. This means a 1% increase for all land/property sales in the panchayats and 1% reduction in the corporation areas.
The stamp duty is calculated based on the actual sale value of the property. However, it is required that the sale value cannot be lower than the "fair value" of land, as determined by the government. The existing fair value of land in Kerala was fixed in 2010, which will be revised as per the current budget proposals. Government will introduce necessary amendments to the Govt Stamp Act to enable these changes.
For family property partitions, the stamp duty is fixed to Rs 1,000, irrespective of the value of the land. There are no changes proposed for family property partition and gifting of land for immediate family members. For this purpose, the immediate family is defined as wife, husband, children, brothers, sisters, children and grandchildren.
Expenses involved in property purchase
The following are the mandatory fees for land registration in Kerala:
Stamp duty: 6% of sale value(proposed value in 2014 budget)
Registration Fees: 2% of sale value
Documentation fees: This is the fees you pay to the document writers and the charges depends on the writers. You may want to negotiate the price before you start the documentation process.
Depending on your case, you may have the following additional expenses:
1. Fees for your realtors/brokers: The fees charged by brokers vary from 1% to 3% of the market value. In many parts of Kerala, the buyer has to pay 1% and seller has to pay 2% of the sale value. In certain areas like Ernakulam, Kakkanad, Kalamassery etc, the buy is not obligated to pay any broker fees. Instead, the seller is responsible for the entire fees (up to 3%). In many cases, the buyer/seller will negotiate a smaller fees, especially in case of sales for large amounts, above 50 lakhs. Some sellers/buyers would even negotiate for a fixed realtor fees, irrespective of the value of the property.
2. Fees for obtaining documents like encumbrance certificate.
3. Payment of all pending taxes and fees for the property.
4. Pending fees for residents' associations to which the property belongs.
5. Buyer may have to pay a membership fee for the residents' association
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