In a significant move aimed at boosting the formal rental housing market, the Uttar Pradesh government has announced substantial concessions in stamp duty and registration fees for lease deeds. The state cabinet approved the proposal to make the registration of tenancy agreements more affordable and accessible for the general public.
Promoting Formal Tenancy Agreements
State Finance Minister Suresh Khanna explained that the high cost of registration has been a major deterrent for people looking to formalize their rental agreements. While current regulations mandate registration for tenancy deeds exceeding one year, most agreements remain oral or unregistered written documents.
"The government is of the view that people avoid drafting and registering deeds if the fees are high," Minister Khanna stated on Friday. "Therefore, it was felt necessary to provide comprehensive fee exemptions to promote standard tenancy deeds and formalise rental agreements for a period up to 10 years."
New Fee Structure and Slabs
The new policy introduces fixed maximum charges for both stamp duty and registration fees, categorized by the tenancy period and average annual rent. Minister of State (Independent Charge) for Stamps and Registration, Ravindra Jaiswal, highlighted that this would directly benefit the public by eliminating the burden of high stamp duty payments.
The revised fee structure is as follows:
For average annual rent up to Rs 2 lakh:
- Up to 1 year: Rs 500
- 1-5 years: Rs 1,500
- 5-10 years: Rs 2,000
For average annual rent between Rs 2,00,001 to Rs 6 lakh:
- Up to 1 year: Rs 1,500
- 1-5 years: Rs 4,500
- 5-10 years: Rs 7,500
For average annual rent between Rs 6,00,001 to Rs 10 lakh:
- Up to 1 year: Rs 2,500
- 1-5 years: Rs 6,000
- 5-10 years: Rs 10,000
Exclusions and Expected Benefits
Officials clarified that the maximum limit for determining the average annual rent has been set at Rs 10 lakh. However, leases related to toll and mining operations have been specifically excluded from these concessions to prevent potential revenue losses for the state.
The decision is expected to effectively implement the Tenancy Regulation Act in Uttar Pradesh by encouraging both property owners and tenants to prepare and register their lease deeds formally. This formalization is anticipated to significantly reduce disputes and create a more transparent rental ecosystem in the state.
"This will directly benefit the general public, as the burden of paying high stamp duty on tenancy deeds will no longer be felt, and people will be able to register their properties more easily," affirmed Minister Ravindra Jaiswal, underscoring the government's commitment to easing processes for citizens.
