Who has to pay property tax and online payment methods
Land tax, often known as property tax, is required to be paid to the government on a yearly or bi-annual basis in India. This is a tax on the ownership of your property's title. Different states have different land taxes that are based on different property attributes and have different rules. It's given to the local government in the area where the property is located. Land tax applies to plots of land, as well as improvements to the land and buildings on the land, whether they are residential or commercial properties. The significance of land tax Land tax is an important source of money for municipal or civic entities seeking to upgrade a town's or city's infrastructure. Property tax money is utilised for a variety of objectives, including maintaining cleanliness and street lighting, as well as maintaining sewage systems, power, and water supply. Land tax calculation The annual value of the property is used to compute the land tax. This figure was calculated using a variety of ways. Each civic body, hamlet, town, and city may have its own set of rules and valuation systems. The tax is determined by factors such as the property's location and size, as well as the amenities it offers. In India, there are three types of valuation procedures that are used to calculate the annual worth of a property that would decide the property tax. The following are the methods: Unit Area Value System: As the name implies, this technique calculates the property tax based on a per-unit pricing. The carpet area or built-up area is used to calculate the per-unit price. The property's use and location are essential factors in determining the returns that can be expected from the property, and the taxes are calculated accordingly. Municipalities in Hyderabad, Patna, Kolkata, Bengaluru, Delhi, and Ahmedabad use this approach to calculate property taxes. Capital Worth-based Method: This system, which was designed for use by the Brihanmumbai Municipal Corporation, is based on the property's capital value (BMC). Under this approach, the local authority would revise the property's market value on a yearly basis. The Bombay High Court, however, invalidated this method in April 2019. Annual Rental Value System: In this system, the annual rental value of a property is utilised to determine the property tax, regardless of whether it is rented out or not. In order to compute the property tax, the current or potential monthly rental value of the property is determined. Property tax must be paid on a proportion of the owner's earnings from this rental value, whether it is rented out or not. In the cities of Hyderabad and Chennai, this strategy is applied. Who is responsible for paying the land tax? Anyone who owns a house, whether it is occupied or vacant, is required to pay land tax. If a plot is vacant, however, it is not required to be paid. The annual tax paid under the income tax regulations for real estate assets is not to be confused with the land tax. Under the Income Tax Act of 1961, the annual tax is classified as "Income from House Property." Land tax exemptions The government grants a variety of land tax rebates based on a variety of variables. If you fit into one of the refund categories, this can help you save a lot of money. The following is a list of them: Age of the owner: Senior folks pay a lesser property tax. Property age: In some municipalities, older properties are taxed less than newer ones. Property taxes are lower in flood-prone locations due to the nature of the place. Owners who fall into the Low Income Group (LIG) or the Economically Weaker Sections (EWS) are eligible for reduced property taxes. Property occupancy: In some municipalities, the longer a person stays in a property, the lower the property taxes are. Property taxes are cheaper when a property is owned by a charitable trust or is intended for public use. Check out Tax Benefits for Self-Constructed Homes. How can I pay my property or land tax? In India nowadays, there are two options for paying your land or property tax. You have the option of paying it offline or online. Offline mode: Go to your municipal office, get a property tax payment form, fill it out, and bring it in with a check for the needed tax amount. Online mode: You can now pay your property or land taxes via the municipal body's website in your area. Some municipalities have a mobile app that you may download and use to pay your taxes. You can make payments using a variety of methods, including internet banking, mobile wallets, and your debit or credit card. You will be given a PIN and a unique ID for your property.