What this guide covers
If you are buying a shop, an office or a small godown, don’t make the mistake of using the flat rate for your area. In Gujarat and Maharashtra, every zone has separate rates for shops and offices, and they are usually a lot higher than the rate for flats. Most other states also rate commercial property separately. Pick the wrong one and your stamp duty estimate could be off by lakhs.
Separate rates for each type of property
Circle rates are set zone by zone, and inside each zone the government usually lists a separate rate for each kind of property:
- Flats and houses (the residential rate)
- Open plots and land
- Shops
- Offices
- Industrial plots and sheds
The rate that applies to you depends on what the unit is used for. A shop on the ground floor of a housing society still uses the shop rate. An office in a mixed building uses the office rate.
How much higher are shop and office rates?
Here are two real zones from our data. All rates are per sq m.
| Zone | Flat | Office | Shop |
|---|---|---|---|
| Ambawadi, Ahmedabad, zone 21/1 | ₹38,500 | ₹67,000 | ₹1,15,000 |
| Bandra East, Mumbai, zone 29/166 | ₹1,99,380 | ₹2,29,280 | ₹2,49,220 |
In Ambawadi, the shop rate is about three times the flat rate. In Bandra East, the gap is smaller, but the shop rate is still the highest in the zone. We see the same pattern in most areas of Gujarat and Maharashtra.
Calculating stamp duty on a shop
Suppose you are buying a 25 sq m shop in Ambawadi zone 21/1, and you have agreed on a price of ₹26 lakh.
- Circle rate value: ₹1,15,000 × 25 = ₹28,75,000.
- Your price of ₹26 lakh is lower, so stamp duty is charged on ₹28.75 lakh.
- In a state with 6% stamp duty and a 1% registration fee, you pay ₹1,72,500 as stamp duty and ₹28,750 as registration fee.
If you had used the flat rate by mistake, you would have got a value of under ₹10 lakh, and your stamp duty estimate would have been far too low. You can check your own figures with the property value calculator and the stamp duty calculator.
Things that can change the value of a shop or office
Some states adjust circle rate value of commercial units for things like:
- A ground floor shop that doesn’t face the main road, which may be valued lower than one that does
- A very large shop or office, which may get a small reduction
- A mezzanine floor, which is often valued at a part of the full rate
- Parking spaces, which are usually valued separately at a lower rate
These rules are different in each state and can change from year to year. If any of them could apply to your unit, ask the Sub-Registrar office or your lawyer before you pay stamp duty.
Also check whether your state applies the rate to carpet area or built-up area. Our guide on carpet vs built-up area explains the difference.
Industrial property and plots
- For an industrial plot or shed, use the industrial rate for your zone. In some states this rate is for the land only, and a built factory is valued separately.
- For an empty plot, use the open plot rate, whatever you plan to build on it, unless the schedule says otherwise.
- If a zone has no industrial rate, ask the Sub-Registrar which rate will apply. A missing rate does not mean the value is zero.
What stays the same for commercial property
- Stamp duty percentage on a sale is usually the same as for a flat in the same state.
- Stamp duty is still charged on your price or circle rate value, whichever is higher.
- Registration fee works the same way.
What usually changes is the benefit for women buyers. Where states give women a lower stamp duty, it is generally only for homes, so don’t count on it for a shop or office.
Find the rate for your shop or office
- Open your state and area on CircleRate, and find the zone for your property. Our guide on how to read circle rates shows you how.
- Use the shop, office or industrial rate, whichever matches your unit.
- Multiply the rate by the area to get circle rate value.
- Compare it with your price. Stamp duty is charged on the higher one.
Commercial property circle rate: common questions
Is circle rate for a shop different from a flat?
Yes. In most areas the government sets separate rates for flats, shops, offices, plots and industrial units, and the shop rate is usually the highest. Always use the rate for the type of property you are buying.
Is stamp duty higher on commercial property?
In most states stamp duty percentage is the same for a shop, office or flat. You still end up paying more on a shop or office, because its circle rate, and so its value, is usually higher.
Do women buyers get a stamp duty benefit on a shop?
Usually not. In states that give women buyers a lower stamp duty, the benefit is generally only for homes. Check the rule in your state before you plan on it.
Which rate applies to a shop in a residential building?
The shop rate for that zone. The rate depends on how the unit is used, not on the type of building it is in.
What if my area has no rate for offices or shops?
Some zones, especially in villages, have no commercial rates at all. A missing rate is not zero, so ask the Sub-Registrar office which rate they will use for your property.