Stamp duty is essentially a form of tax levied on legal documents in order to make it legally enforceable. In Tamil Nadu, the stamp duty paid for rental contracts is usually equal to 1% of the amount of rent + deposit, regardless of the duration of the rental. To prepare a lease, start by creating a draft version after discussing the clauses with your landlord/tenant. There are certain clauses that should never be omitted in a rental agreement, which will be discussed later in the article. Add all the desired details and check the act as soon as the design is ready. Buy buffer paper of the recommended value, which depends on your rent and deposit amounts. Finally, print your document on stamp paper. Capitals like Chennai, Coimbatore, Salem, etc. are used to making sophisticated deals, while smaller towns like Madurai, Tiruchirapalli, Tirunelveli, etc. are more forgiving. Token Advance – Token Advance refers to a small amount of money that the tenant pays to the lessor before signing the rental deed.
The idea is to prevent the landlord from preventing other potential tenants from developing an interest in the property. Once the advance of the tokens is paid, the agreement is considered final. When a party decides to make itself retractable, it is obliged to replace the losses suffered by the other party. From a horde of MNCs to ancient temples, Chennai has it all. It is therefore not surprising that a good number of educated people move to cities like Chennai and Coimbatore, mainly for jobs, which in turn has increased the demand for rental property. Which brings us to the point of this article, how to make a lease in the cities of Tamil Nadu? The omission of certain important clauses in your rental agreement leads to unpleasant disputes in case of disagreement between the tenant and the lessor. Even if the two parties know each other, the ideal is to make a comprehensive agreement to cover your back. In case of disagreement in the future, the lease will be one of the priorities of the dispute.
However, there are other factors that, if overlooked, can cause bigger problems. Here are some of the things you need to keep in mind – Normally, for leases for a period of less than 11 months, twenty rupees are stamp papers. From 11 months, the amount of the annual rent plus the deposit is calculated. 1% of the total amount is stamp duty. It may seem like a big effort, but now you can use online rental services. As of now, they are issued and regulated by stock Holding Council of India Limited (SHCIL). They are linked to different banks in order to provide electronic stamp paper to the general public. Deposit – Deposit is a certain amount of money collected in advance by the tenant in order to avoid losses for the landlord due to non-payment of rent or damage to the property. The amount is usually a few months` rent and is reimbursed to the lessor at the time of handing over the keys. If the required stamp duty is not paid, disputes were to arise and if the cases were to be brought before the courts, the parties involved could have to pay almost ten times the effective stamp duty.
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