Deposit & rent agreement cost
What a tenant actually pays in the first week, expressed in months of rent. The number to say out loud at the first viewing, because it is the most common reason a let collapses late.
Your numbers
| Stamp duty baseAnnual rent plus the share of deposit your state includes. | — |
| Stamp duty | — |
| Registration + charges | — |
| Brokerage | — |
| Day-one cost as multiples of rentThe number to quote a tenant early, so nothing collapses at signing. | — |
Tenants budget the rent and are then asked for the deposit, a month in advance, the agreement charges and the brokerage — all in the same week.
Stamp duty on a rent agreement is usually calculated on a formula involving the annual rent and the deposit, and it varies substantially by state. So does whether registration is mandatory, which for agreements of twelve months or more it commonly is.
Putting the day-one number in front of a tenant early prevents the most common cause of a let falling apart at the last moment.
How stamp duty on a rent agreement works
Most states compute it on a base made up of the total rent over the term plus a notional share of the interest-free deposit, then apply a percentage. Both the share and the percentage vary by state, which is why this calculator asks you to set them rather than guessing.
Registration is a separate fee. Agreements of twelve months or more commonly attract a compulsory registration requirement, and several states have enacted tenancy legislation with its own registration obligations — which is a large part of why eleven-month agreements are so common.
Worked example
₹22,000 rent, 11 months, three months' deposit (₹66,000), 0.25% duty on a base of total rent (₹2.42 lakh) plus 10% of the deposit (₹6,600) — a base of ₹2.49 lakh and duty of about ₹620. Add ₹1,000 registration and ₹1,500 of drafting and e-stamp charges: roughly ₹3,100 to execute.
Day one, the tenant pays ₹66,000 deposit + ₹22,000 advance rent + ₹3,100 agreement + ₹22,000 brokerage = about ₹1.13 lakh, or 5.1 months of rent, in one go.
That is the number to say out loud at the first viewing. It is the most common reason a let falls apart in the final week.
Deposit norms
Deposit expectations vary enormously by city, and some states have introduced statutory caps under tenancy legislation. Check what applies locally rather than following a national convention that may not exist where you work.
Rates, bases, caps and registration requirements are set by each state and change. Confirm locally before either party relies on a figure.
Questions
Why are most rent agreements eleven months?
Agreements of twelve months or more generally trigger compulsory registration and higher duty in many states. Eleven months keeps the arrangement below that threshold, which is why it became the default.
Is an unregistered rent agreement valid?
Its evidentiary value in a dispute can be limited, and several states now impose registration obligations under tenancy legislation. It is inexpensive to comply with and expensive to have ignored — worth confirming locally.
Who pays the stamp duty and registration?
It is a matter of agreement and local convention; in many markets the tenant does, in some it is shared. Settle it before the agreement is drafted rather than on the day.
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