Stamp Duty on Rent Agreement: State-wise Rates for Offices, Shops and Warehouses (2026)
"Just put it on ₹100 stamp paper." That's the most common advice small businesses get when renting a space, and for most commercial leases it's wrong. Stamp duty on a rent agreement is calculated as a percentage of rent in most states, and an under-stamped lease can cost you a penalty of several times the shortfall when you need it most.
This guide gives state-wise rates, explains how to calculate duty on your actual rent, and covers when a rent agreement must also be registered.
Stamp Duty on Rent Agreement: State-wise Table
| State | Stamp duty | Deposit included? | Registration |
| Delhi | 2% of average annual rent (min ₹100) | No | Required above 11 months |
| Uttar Pradesh | 2% of total rent + deposit, ₹100 min, ₹10,000 max (short-term) | Yes | Required above 11 months |
| Haryana | 1.5% of average annual rent (under 5 years); 3% (5 to 10 years) | No | Required for a year or more |
| Maharashtra | 0.25% of total rent + notional interest on deposit (min ₹100) | Yes (as interest) | Compulsory for all |
| Karnataka | 0.5% of average annual rent + deposit; ₹500 cap commonly applied to residential | Yes | Recommended; required above 11 months |
| Tamil Nadu | 1% of total rent for the term | No | Compulsory for all |
| Telangana | 0.4% of total rent for the term (min ₹50) | No | Required above 11 months |
| Gujarat | ₹500 flat (residential under 1 year); 1% of average annual rent (1 to 5 years) | No | Required above 11 months |
Compiled from state stamp schedules as of mid-2026. Rates are revised by notification, and commercial leases can fall under different articles from residential ones in some states. Confirm on your state's calculator before paying.
How to Calculate Stamp Duty on a Rent Agreement
Find Term
Note the lease period: 11 months, 3 years, 5 years. Many states use different rates for different lease terms, so the term decides which slab of rent agreement stamp duty applies.
Total Rent
Multiply monthly rent by the number of months. Include fixed maintenance only if it's part of the rent in the agreement. This total is the base for most rent agreement stamp duty calculations.
Annual Average
For multi-year leases, divide total rent by the number of years. Delhi, Haryana and Gujarat calculate stamp duty on this average annual rent, not on the full multi-year rent amount.
Add Deposit
In UP and Karnataka, add the refundable deposit to the base. In Maharashtra, add notional interest on the deposit at 10% a year. Other states usually ignore the deposit for stamp duty.
Apply Rate
Multiply the base by your state's rate, then apply any minimum or maximum. Round up to the nearest rupee and buy e-stamp paper for exactly that amount.
Worked Examples
1. Delhi retail shop: ₹75,000/month, 11 months. Base = ₹8,25,000 → 2% = ₹16,500
2. Gurugram warehouse (Haryana): ₹2,00,000/month, 3 years. Total = ₹72,00,000; average annual = ₹24,00,000 → 1.5% = ₹36,000. Registration required.
3. Mumbai office (Maharashtra): ₹1,50,000/month, 24 months, deposit ₹9,00,000. Rent = ₹36,00,000; interest on deposit = ₹9,00,000 × 10% × 2 = ₹1,80,000; base = ₹37,80,000 → 0.25% = ₹9,450 + registration fees.
4. Chennai office (Tamil Nadu): ₹60,000/month, 11 months. Total = ₹6,60,000 → 1% = ₹6,600. Registration compulsory.
Who Pays Stamp Duty on a Rent Agreement?
By default, most state Stamp Acts put the liability on the lessee (tenant). The parties can agree otherwise, and many commercial leases split it 50:50. Write this in the agreement to avoid disputes.
Why 11-Month Rent Agreements Are Popular
In most states, leases of more than 11 months need compulsory registration under the Registration Act, 1908, which adds fees and a visit to the Sub-Registrar. An 11-month lease avoids that, but:
- It still needs full stamp duty on the rent for those 11 months.
- An unregistered lease offers weaker protection in long-term disputes.
- Maharashtra and Tamil Nadu require registration regardless of term.
For high-value commercial leases, a registered multi-year lease with a lock-in clause is often the better business decision.
What Happens If a Rent Agreement Is Under-stamped?
- Not admissible as evidence in court until the deficit is paid.
- Penalty of up to 10 times the deficient duty in some states, at the discretion of the Collector.
- Problems with banks and GST: Banks and GST officers may reject an obviously under-stamped lease as proof of business premises.
You can voluntarily get an under-stamped document adjudicated by the Collector and pay the deficit, usually with a smaller penalty than if it's caught in litigation.
Documents Needed for a Commercial Rent Agreement
Ownership Proof
The landlord's sale deed, latest property tax receipt or allotment letter proves they have the right to lease the property. Banks and the GST department frequently ask for this with your rent agreement.
Identity Proof
PAN and Aadhaar of individual parties, or the certificate of incorporation, PAN and board resolution for companies. Use exact legal names on the agreement and the e-stamp paper.
Authorisation
If a director, partner or employee signs for the business, attach a board resolution or authority letter. Without it, the counterparty can later challenge whether the rent agreement binds the company.
E-Stamp Paper
Buy e-stamp paper for the calculated duty in the state where the property is located. Verify it online before signing, especially when the landlord or broker supplies it.
Frequently Asked Questions (FAQs)
What is the stamp duty on a rent agreement in India?
It varies by state. Most states charge a percentage of rent, for example 2% of average annual rent in Delhi, 1.5% in Haryana, 1% of total rent in Tamil Nadu and 0.25% of rent plus deposit interest in Maharashtra.
Is ₹100 stamp paper enough for a rent agreement?
Usually not for commercial leases. Most states charge a percentage of rent, so ₹100 is only enough when the calculated duty is below the state minimum.
Who pays stamp duty on a rent agreement, landlord or tenant?
By default, usually the tenant. The parties can agree to split it, and the agreement should state who pays.
Is registration mandatory for an 11-month rent agreement?
In most states, no. Maharashtra and Tamil Nadu require registration for all rental agreements regardless of term.
What is the penalty for an under-stamped rent agreement?
The document can't be used as evidence until the deficit is paid, and a penalty of up to 10 times the deficit may apply in some states.
Is the security deposit included in stamp duty?
In some states, yes. Uttar Pradesh and Karnataka add the deposit, Maharashtra adds notional interest on it, and Delhi, Haryana and Tamil Nadu generally don't.
Can I pay rent agreement stamp duty online?
Yes. Most states use SHCIL e-stamping, Maharashtra uses GRAS or e-SBTR, and Karnataka uses KAVERI-2 digital e-stamps.
Conclusion
Stamp duty on a rent agreement is a small cost compared to the rent itself, but getting it wrong turns a lease into a weak document. Calculate on the real rent and term, include the deposit where your state requires it, decide who pays in writing, and register when the law or the stakes call for it.
Buy and verify the stamp using our e-stamp paper online guide, or talk to the StartupFlora team for help with commercial leases and business registration.