Stamp duty is a state levy paid to register a document, typically an agreement or transaction paper between two or more parties, with the registrar. Usually, it is a fixed amount depending on the nature of document or is charged at a certain percentage of the agreement value stated in the document.
Stamp duty is not uniform across states and varies for different type of documents. For instance, in case of registration of a property paper, stamp duty is charged on the transaction value or circle rate (minimum price of property, as per the government), whichever is higher. It may also vary depending upon the owner’s gender. For instance, in New Delhi, a woman has to pay 4% stamp duty, compared with 6% for a man. Similarly, in Haryana, a man is required to pay 8% stamp duty in urban areas and 6% in rural areas, while a woman has to pay 6% and 4%, respectively.
A homebuyer can claim deduction against payment of stamp duty and registration fee under the overall limit of ₹1.5 lakh under Section 80C of the Income-Tax Act, 1961.