Why is stamp duty paid on a rent agreement?
A rent agreement is a legal document, so stamp duty must be paid on it under the Indian Stamp Act and state stamp laws. An agreement without the correct stamp duty carries less weight as evidence in court and can attract a penalty.
- Stamp duty varies by state — a flat amount in some states and a percentage of the rent in others.
- In several states, the security deposit is also included in the calculation.
- Agreements of 12 months or more must be registered under the Registration Act, which is why most people sign 11-month agreements.
State-wise stamp duty rules (residential, up to 11 months)
| State | Stamp duty | Registration |
|---|---|---|
| Maharashtra | 0.25% of (total rent + 10% yearly notional interest on the deposit), minimum ₹100 | Registration is mandatory for leave and licence agreements |
| Delhi | 2% of the average annual rent, minimum ₹100 | Optional for agreements up to 11 months |
| Karnataka | 0.5% of (average annual rent + deposit), maximum ₹500 | Optional for agreements up to 11 months |
| Tamil Nadu | 1% of the total rent | Registration is mandatory for all rent agreements |
| Telangana | 0.4% of the total rent, minimum ₹50 | Optional for agreements up to 11 months |
| Uttar Pradesh | 2% of (total rent + deposit), minimum ₹100, maximum ₹10,000 | Optional for agreements up to 11 months |
| Gujarat | Flat ₹500 for residential agreements under one year | Optional for agreements up to 11 months |
| Haryana | 1.5% of the average annual rent | Optional for agreements up to 11 months |
| Rajasthan | Slab based on the DLC (market) value of the property — use the e-Panjiyan calculator | Optional for agreements up to 11 months |
| West Bengal | Nominal stamp paper (usually ₹100) | Optional for agreements up to 11 months |
Please note: these rules are taken from public sources and state governments revise them from time to time. Rules for commercial property can differ. Confirm the current rate before buying stamp paper.
How do you get e-stamp paper?
In most states, e-stamp paper is available from the SHCIL (Stock Holding Corporation of India) e-stamping portal or an authorised vendor. Some states, such as Maharashtra, also allow leave and licence agreements to be registered online.
Frequently asked questions
How much stamp duty is payable on an 11-month rent agreement?
It depends on the state — for example, 2% of the average annual rent in Delhi, a maximum of ₹500 in Karnataka and a flat ₹500 in Gujarat. Choose your state in the calculator above.
Why are rent agreements usually made for 11 months?
Leases of 12 months or more must be registered under the Registration Act. In most states, registration is optional for agreements of up to 11 months, which saves cost and effort.
Is stamp duty charged on the security deposit?
In some states, yes — for example Maharashtra (through notional interest on the deposit), Karnataka and Uttar Pradesh include the deposit.
Who pays the stamp duty — the tenant or the landlord?
The law does not fix this. Usually the tenant pays, or both share it equally. It should be stated in the agreement.
Is an online rent agreement valid?
Yes, if it is made on e-stamp paper of the correct value and signed by both parties. Maharashtra also offers online registration.
Is registration mandatory for rent agreements in Maharashtra?
Yes. In Maharashtra, leave and licence agreements must be registered, even for 11 months.
What happens if less stamp duty is paid?
To use the agreement as evidence, the shortfall in stamp duty and a penalty have to be paid.
How is stamp duty on a rent agreement calculated in Rajasthan?
In Rajasthan, it is based on the DLC value of the property and the lease period. Use the IGRS e-Panjiyan calculator or ask an expert to work it out.