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Writer's pictureLead India
Apr 27, 20234 min read

How To Save Property Tax Without Any Penalty ?

Most homeowners will likely say they pay excessive amounts in property taxes if you ask them about it. Homeowners pay property taxes, which are property taxes determined by local governments. They are regarded as ad valorem, meaning that they are calculated based on the market value of your property.


Property tax money is typically used to support neighbourhood initiatives and services including local public recreation, police enforcement, and education. Property taxes can be very onerous for individual homes, despite the fact that all residents benefit from these services. They typically increase gradually over time. Even when your mortgage is paid off, you still have to pay taxes. Although some states have lower property tax rates than others, there is usually some sort of tax required to fund local services.


Ways to Save Property Tax without Any Penalty


Stamp Duty Return for Female Purchasers

  • The tax known as stamp duty is due on the sale contracts either prior to or on the day when the property is registered. You turn the acquisition of the property into a legal transaction by depositing the stamp duty. The stamp duty is often calculated as 5% of the overall cost of the property; however, state-by-state variations exist.

  • Both finished and unfinished properties are affected. Registering the property in the name of a woman is one of the finest ways to receive a stamp duty discount of up to 2%.

Minimizing Stamp Duty and Registering Fees by Utilizing Government Guidance Rate

  • Even the government keeps an established minimum price for which a property can be listed. This rate, sometimes referred to as the Government Guideline Rate or Circle Rate, is typically far less than the property's market value. Even if you previously own a property, you can register it at this price.

  • Therefore, even if a home has a market value of 1 crore rupees and a government-recommended value of 65 lakh rupees, with stamp duty of 5% and registration fees of 1%, you can still save a lot of money by choosing the recommended rate while submitting the house purchase tax.




Learning More about the Stamp Duty and Local Registration Laws

  • Because registration costs and stamp charges vary from state to state, it can be quite helpful to understand the laws that are in effect in your state. When purchasing a property from a buyer who recently bought it less than a year ago, for example, in Maharashtra, the fees for registration only apply to the net profit.

  • For example, if a buyer bought a home for 90 lakh rupees about ten months ago and wishes to sell it for 95 lakh rupees right away, the new buyer will just need to pay registration fees of 5 lakh rupees.

Properties that is ready to Move into for GST Exemption

  • A 5% GST will be charged if you buy a property that is still being built, in accordance with recent revisions made by the Goods and Services Tax (GST) Council. Ready-to-move-in properties are not required to pay any GST, nevertheless.

  • Ready-to-move property can assist you to save a few dollars on GST if you are going to buy a property but have not yet decided which one.

Home Loan to Reduce Taxes

  • If you take out a home loan to buy a house, you might be able to reduce your income taxes. If you meet the prerequisites, you may claim income tax deductions on both the principle and the interest amount under the virtue of Section 80C, Section 24, and Section 80EE of the Information Technology Act.

  • Additionally, if you take out a combined loan, both holders are eligible to deduct up to 1, 50,000 rupees from their taxable income for the principal balance and up to 2,00,000 rupees for interest payments made during a given fiscal year.

Tax on Property Purchase: An Overview

There are various ways to pay a lower tax when purchasing a home. The majority of buyers are frequently uninformed of such rules, which forces them to pay a far higher tax when purchasing a home.


You must learn as much as you can about the local regulations since they can save you money and make the entire process of buying a property a little more manageable because the local laws differ between states.


You will need a lawyer to let you know how to save property taxes without giving any penalty. If you want the help of lawyers to assist you in saving the property taxes in Kolkata, then property lawyers in kolkata can be hired, and if you want the help of lawyers to assist you in saving the property taxes in Bangalore, then property lawyers in bangalore can be hired.


Similarly, property lawyers in delhi can be employed if you want the help of lawyers to assist you in saving the property taxes in Delhi.


At Lead India, you can consult and talk to lawyers there. You can obtain free legal advice online as well as ask a legal question online for free to lawyers at Lead India.


Call Us: +91–8800788535

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