The Uttar Pradesh government has revised the stamp duty and registration charges for lease and rent agreements of up to 10 years. The revision has brought relief to landlords and tenants. The revised rates are based on annual rent and the duration of the agreement.
Registering the rent agreement would particularly get cheaper for those entering into long leases. The Cabinet has approved the revised framework, which aims to encourage landlords and tenants to register the contracts by making it more affordable. The move would avoid informal agreements, which usually lead to disputes.
What has changed?
The revised structure applies the new charges across three tenures: up to one year, exceeding one year and up to five years, and more than five years and up to 10 years.
— Tenures up to 1 year: Agreements with average annual rents up to Rs 2 lakh would have a stamp duty of Rs 1,000; agreements with annual rents between Rs 2 lakh and Rs 6 lakh would have a stamp duty of Rs 3,000; agreements with annual rents between Rs 2 lakh and Rs 6 lakh would have a stamp duty of Rs 4,500.
— Tenures from one to five years: Agreements with average annual rents up to Rs 2 lakh would have a stamp duty of Rs 2,000; agreements with annual rents between Rs 2 lakh and Rs 6 lakh would have a stamp duty of Rs 6,000; agreements with annual rents between Rs 2 lakh and Rs 6 lakh would have a stamp duty of Rs 10,000.
— Tenures from five to ten years: Agreements with average annual rents up to Rs 2 lakh would have a stamp duty of Rs 4,000; agreements with annual rents between Rs 2 lakh and Rs 6 lakh would have a stamp duty of Rs 8,000; agreements with annual rents between Rs 2 lakh and Rs 6 lakh would have a stamp duty of Rs 13,000.
If the annual rent exceeds Rs 10 lakh, the concession would apply to the first Rs 10 lakh. For amounts above the threshold, the existing rates would be applicable. Also, the concession does not cover toll-related and mining leases.
Note that the registration fee would be equal to the stamp duty for each slab.
Reason for change
Registration is already mandatory for leases of more than one year; however, higher costs may deter people from entering into formal agreements. The revamped structure seeks to make formal registration more affordable, thus encouraging more people to register leases.
Moreover, it would boost the implementation of the Uttar Pradesh Regulation of Urban Premises Tenancy Act, 2021. In case of disputes, tenants and landlords would have formal documentation of the terms of tenancy, such as the rent, tenure, and other conditions.
