7 Details You Need to Know About Property Tax in India

Have you heard about the property tax in India? 

Well, along with the personal taxes we all pay in our day to day, property owners in the country are also bound by law to pay a property tax, i.e., a tax levied by the local government on the owners of real estate properties within its jurisdiction. 

At the end of the day, property tax is one of the main sources of revenue for the municipal corporations and other local bodies in India. Property tax rates and rules vary from state to state and city to city, but there are some common details that every property owner should know. Here are seven of them.

1. Property Tax in India: How is it Calculated?

The calculation of property tax in India varies from one municipal authority to the other. However, there are three main methods of calculating property tax:

• Capital Value System (CVS): This system is based on taxing the market value of a property. A small percentage of the same is then charged as property tax. 
• Annual Rental Value System (RVS): As the name suggests, this system calculates tax on the basis of a property’s yearly rental value.
• Unit Area Value System (UAS): As per this system, property tax in India is based on the property’s unit price as per its built-up area.

2. How Often Do You Have to Pay Property Tax in India?

Property tax is usually paid annually or half-yearly, depending on the rules of the local authority. Some municipal corporations also offer discounts or incentives for timely payment or advance payment of property tax. You can pay your property tax online or offline, through various modes such as net banking, credit card, debit card, cheque, cash, or demand draft.

3. What Are the Benefits of Paying Property Tax?

Paying property tax in India on time has several benefits for you as a property owner and a citizen. First, it helps you avoid penalties, interest, or legal action for non-payment or late payment of property tax. Second, it helps you establish your legal ownership and title of the property, which is essential for selling, transferring, or mortgaging your property. Third, it helps you contribute to the development and maintenance of civic amenities and infrastructure in your locality, such as roads, water supply, drainage, street lights, parks, etc.

4. What Are the Consequences of Not Paying Property Tax?

Not paying property tax on time can have serious consequences for you as a property owner and a citizen. First, it can attract penalties, interest, or legal action for non-payment or late payment of property tax. The local authority can also seize or auction your property to recover the dues. Second, it can affect your credit score and rating, which can hamper your ability to get loans or other financial services in the future. Third, it can deprive you of your civic rights and privileges, such as voting, contesting elections, availing subsidies or benefits from government schemes, etc.

5. How Can You Reduce Your Property Tax Liability?

There are some ways to reduce your property tax liability legally and ethically. One way is to claim exemptions or rebates for certain categories of properties or owners, such as senior citizens, women, disabled persons, war veterans, etc., if applicable. Another way is to appeal for a revision or correction of your property valuation or assessment if you think it is inaccurate or unfair. You can also apply for a self-assessment scheme if available in your locality, where you can declare your own annual value of your property based on certain guidelines and criteria.

6. How Can You Check Your Property Tax Status and History?

You can check your property tax status and history online or offline through various channels provided by the local authority. You can visit the official website or app of the municipal corporation or local body and enter your property details, such as assessment number, owner name, address, etc., to view your property tax status and history. You can also visit the nearest ward office or customer care centre and request for your property tax statement or receipt.

7. How Can You Update Your Property Details and Records?

You can update your property details and records online or offline through various channels provided by the local authority. You can visit the official website or app of the municipal corporation or local body and fill up an online form with your updated property details such as owner name, address, contact number, email id, etc., and submit it along with supporting documents such as sale deed, mutation certificate, power of attorney, etc., if required. You can also visit the nearest ward office or customer care centre and submit a physical form with your updated property details and documents.

Conclusion

In a nutshell, property tax in India is an important source of revenue for municipal authorities. The money collected from property tax is used to fund the following services:

• Water supply and sanitation
• Roads and bridges
• Street lighting
• Garbage collection and disposal
• Parks and playgrounds
• Public health and education

Thus, by paying it timely, you not only avoid legal penalties but also help make a positive contribution towards national welfare!