In Delhi, every homeowner is required to pay an annual property tax to the Municipal Corporation of Delhi or MCD. Typically, all buildings and vacant lands also come under the purview of tax calculation and payment. To calculate the said tax, the MCD relies on the Unit Area System recommended by the Indian government.
The MCD works through its subdivisions EDMC, NDMC and SDMC, while the entire city is placed under 8 categories ranging from ‘A’ to ‘H’. Such categorisation is based on the valuation of properties, and applicable rates levied by the MCD. Property owners based in Delhi must gain a detailed insight into the tax calculation as per applicable rates and find out how to pay property tax online. They must make timely payment of such tax to avoid any penalty.
Formula to compute tax on property
According to the Unit Area System, tax on property is calculated in Delhi through the following formula –
Property Tax = Annual Value of Property x Rate of Tax
Here, the Annual value = Unit area value per square metre x Unit area covered by the property x Age factor x Occupancy factor x Structure factor
Once property owners figure out all the vital details pertaining to the tax they have to pay, they can proceed to learn about the payment procedure. It will help them to streamline the process and eliminate any risk of making an error during tax filing.
Steps to pay property tax online
Property owners can digitally pay taxes on their property conveniently either through internet banking, credit card or debit card.
These following steps highlight how to pay property tax online quickly.
Step 1 – Visit MCD’s official website.
Step 2 – Select the suitable corresponding area from EDMC, NDMC and SDMC.
Step 3 – Navigate to the ‘Property Tax’ option.
Step 4 – Select the ‘Online Filing of Property Tax Returns’.
Step 5 – Once redirected to the terms and conditions, go through all the details properly.
Step 6 – Proceed with the ‘Click Here to File Property Tax’ option.
Step 7 – Enter property ID and other required details.
In case a taxpayer does not have a property ID, they need to proceed with the ‘Click Here to File Your Return If Property ID Not Allotted Earlier’ option.
Step 8 – Update property details pertaining to ownership, measurement, market value, contact information, building details and tax computations.
Step 9 – Include details of previous arrears, which are yet to be submitted.
Step 10 – Review the details and then click on ‘Accept’ to initiate payment.
Once the form is submitted, and payment made, taxpayers must download the property tax receipt. This document will come in handy, especially for those who plan to avail or are existing borrowers of secured credits like a loan against property (LAP) and wish to claim tax exemptions on it.
To claim the same, it is essential for individuals to first find out which exemptions apply in their case. Subsequently, they should proceed to find out more about how to avail tax benefits on their LAP and proceed accordingly.
Tax rebate for properties in Delhi
Property taxpayers in Delhi can also receive rebates under the following circumstances.
- For property taxes paid in a lump sum by the 1st quarter, a rebate of 15% on the total tax amount is applicable.
- A rebate of 10% on annual value is allowed to the owners of CGHS/DDA flats measuring up to 100 square metres.
- Senior citizens, physically challenged individuals and women can avail a rebate of 30% on only one property.
It must be noted that a delay in paying property taxes attracts a penalty at the rate of 1% for each month of such delay. Since leading financial institutions consider tax receipts as one of the essential documents needed to apply for a loan against property, the process of availing these advances can be delayed due to any default in tax payment.
Customers availing the credit can also benefit from pre-approved offers provided by lenders and enjoy hassle-free loan processing. Such offers are available on multiple financial products, including home loans and loans against property. You can check your pre-approved offer in just a few seconds by entering your name and contact number.
Notably, besides figuring out how to pay property tax online, property owners must also become familiar with other charges which they may have to pay if they decide to sell their property located in Delhi. For example, they must find out things like how TDS on property sale is calculated and deducted for a streamlined filing of tax return.
