UP Government Moves To Ease Rent Agreement Registration, Slash Stamp Duties

The Uttar Pradesh government is preparing a proposal to dramatically reduce the cost of registering rent agreements. The Department of Stamp and Registration is finalising a plan that would introduce fixed caps on registration charges, which are currently calculated as a percentage of the total lease value, making the process expensive and discouraging compliance, as per a report by the Times of India.

Under the current rules, registering a lease deed attracts a stamp duty of 4 per cent. This has long been criticised as prohibitive, especially in longer-term rental arrangements. “Now, the issue would often be of who would pay this amount. People often find it expensive. However, the drawback of this would be that in case of any dispute between tenant and owner, nobody would benefit from the provisions of the Rent Control Act of 2021 if the lease was unregistered,” said Ravindra Jaiswal, Minister of State (Independent Charge) for Stamp and Registration. “To make this entire process simple, we are looking at the possibility of capping this amount,” he added, as per the report.

According to Jaiswal, a typical rental agreement for three years at a monthly rent of Rs 20,000 amounts to Rs 7.2 lakh in total rent. At the current 4 per cent rate, the stamp duty would be Rs 28,800. Under the new proposal, the charge would be reduced to just Rs 5,000.

If approved, the new structure would see rent agreements registered at a flat fee of Rs 500 for annual rents below Rs 2 lakh, Rs 5,000 for rents between Rs 2 lakh and Rs 5 lakh, and Rs 20,000 for amounts above that. The reform is intended to incentivise more tenants and landlords to register their agreements, thereby ensuring eligibility for legal protections under the Rent Control Act, the report added.

Beyond rental agreements, the state government is also looking to incentivise property ownership among women. Following a recent review with Chief Minister Yogi Adityanath, officials are exploring an expansion of the 1 per cent stamp duty rebate for women. The concession, which currently applies to properties valued at up to Rs 10 lakh, would be extended to those worth as much as Rs 1 crore, the report added.

The government is also mulling a cap on stamp duties involved in the division of ancestral property. The proposed ceiling would fix the maximum duty at Rs 5,000 when immovable property is divided among family members spanning up to three generations.

Jaiswal confirmed that a comprehensive report outlining these proposed changes is in the works and will be presented to the state Cabinet within the next couple of months. If implemented, these measures could streamline property transactions, reduce legal complications, and increase compliance across Uttar Pradesh.