Why Paying your Property Tax on Time Important?
Mar 25, 2020 Home Trading Steps
Not paying the property tax or delaying in the payment can welcome severe consequences your way from now on. BMC recently announced that they will start seizing the valuables of the property defaulters. According to the statement made by Sangita Hasnale, assistant municipal commissioner of BMC’s assessment and collection department, BMC will first start targeting commercial properties, then will move to residential and individual properties. The authorities will seize valuables, including furniture, from defaulters if they fail to pay their dues.
House tax, commonly called as property tax or municipal tax is imposed by the relevant municipal authorities. The tax collected is used to maintain the basic civic amenities such as lights, proper sewage system, roads etc.
Not paying the house tax can lead to legal problems in later stages. We discuss everything you need to know about property tax and why it is important to pay the same on time.
The property owner, be it land, flats, independent house, need to pay a dedicated amount to the authorities every year in the form of house tax or property tax to avail various civic and basic amenities. There are certain categories of property owners who are exempted from paying tax or the applicable property tax rate is low for the certain property owner. Agricultural land or the land used to build worshipping place is exempted from paying property tax. There is a rebate of property tax for women, senior citizens, ex-servicemen etc. Therefore, it is necessary to check the applicable rate and rebate when paying the property tax.
Applicable Tax Rate
Every municipal authority has its own method of calculating the property tax. The calculation of tax is based on factors like locality, size, type, age of the property, commercial, residential or agricultural land, and details or owner.
It is calculated as a percentage of annual rental value, capital value or unit area value of the property. As every municipal authority has a different way of calculating the tax applicable, the tax varies from city to city. The Municipal Corporation of Delhi follows the unit area system to calculate the tax. The unit area value for eight categories (A to H) of colonies ranges from Rs 100 sqm (for H category) to Rs 630 sqm (for A category) of the property in Delhi.
The tax rate can even vary within a city if there are multiple municipal authorities. Under Municipal Corporation of Delhi, there are three corporations: South, North and East Delhi corporations. New Delhi Municipal Council area takes care of the area in Delhi called Lutyen’s Delhi. The rate of property tax varies from 6 percent to 20 percent the value of the property.
A tax calculator is available on the municipal authority’s website that can help the property owner to calculate the tax payable.
Modes of paying property tax
Depending on the municipal authority, the tax could be paid annually or semi-annually. Certain municipal authorities have a website that allows the property owners to pay the tax online. Alternatively, the property owners can also pay the tax at the municipal office. The details required while paying the tax are house number, type of property, complete address bank details, tax number etc.
Importance of property tax payment
The authorities can provide necessities like water, drainage, cleanliness etc with the tax paid by the property owners. The salary of the workers come from the tax as well. If you fail to pay the property tax on time, there are chances that penalty will be applied by the respective authority.
Non- payment of tax can also create a problem when trying to sell the property. At the time of registration, the property owner needs to produce the property tax payment receipts as proof of clear name title. Failure to do will result in cancellation of the property deal. The authorities can also impose charges on the property owner for the failure of tax payment.
House tax, commonly called as property tax or municipal tax is imposed by the relevant municipal authorities. The tax collected is used to maintain the basic civic amenities such as lights, proper sewage system, roads etc.
Not paying the house tax can lead to legal problems in later stages. We discuss everything you need to know about property tax and why it is important to pay the same on time.
The property owner, be it land, flats, independent house, need to pay a dedicated amount to the authorities every year in the form of house tax or property tax to avail various civic and basic amenities. There are certain categories of property owners who are exempted from paying tax or the applicable property tax rate is low for the certain property owner. Agricultural land or the land used to build worshipping place is exempted from paying property tax. There is a rebate of property tax for women, senior citizens, ex-servicemen etc. Therefore, it is necessary to check the applicable rate and rebate when paying the property tax.
Applicable Tax Rate
Every municipal authority has its own method of calculating the property tax. The calculation of tax is based on factors like locality, size, type, age of the property, commercial, residential or agricultural land, and details or owner.
It is calculated as a percentage of annual rental value, capital value or unit area value of the property. As every municipal authority has a different way of calculating the tax applicable, the tax varies from city to city. The Municipal Corporation of Delhi follows the unit area system to calculate the tax. The unit area value for eight categories (A to H) of colonies ranges from Rs 100 sqm (for H category) to Rs 630 sqm (for A category) of the property in Delhi.
The tax rate can even vary within a city if there are multiple municipal authorities. Under Municipal Corporation of Delhi, there are three corporations: South, North and East Delhi corporations. New Delhi Municipal Council area takes care of the area in Delhi called Lutyen’s Delhi. The rate of property tax varies from 6 percent to 20 percent the value of the property.
A tax calculator is available on the municipal authority’s website that can help the property owner to calculate the tax payable.
Modes of paying property tax
Depending on the municipal authority, the tax could be paid annually or semi-annually. Certain municipal authorities have a website that allows the property owners to pay the tax online. Alternatively, the property owners can also pay the tax at the municipal office. The details required while paying the tax are house number, type of property, complete address bank details, tax number etc.
Importance of property tax payment
The authorities can provide necessities like water, drainage, cleanliness etc with the tax paid by the property owners. The salary of the workers come from the tax as well. If you fail to pay the property tax on time, there are chances that penalty will be applied by the respective authority.
Non- payment of tax can also create a problem when trying to sell the property. At the time of registration, the property owner needs to produce the property tax payment receipts as proof of clear name title. Failure to do will result in cancellation of the property deal. The authorities can also impose charges on the property owner for the failure of tax payment.
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