In India, any property owner is liable to pay taxes for his/her assets that can include a land or a building. Generally, the municipal corporation or a local authorised body collects such property taxes annually. As these governing bodies do not notify the owners of the due amount, the responsibility for timely payment lies with the property owner. The collecting authority can, however, issue notice for any default in payments. Moreover, if such property owners skip their tax payment, they need to pay penalty or legal charges as well.
Therefore, individuals should make timely tax payments on their properties to avoid unnecessary fines. Most municipal corporations have come up with property tax online payment options to ensure a faster and hassle-free payment process.
Here is a complete guide to the payment of property tax online alongside all required details about the tax.
Steps to follow for online payment of the tax
In India, as property taxes are payable after self-assessment, owners can begin with such calculations to assess their tax liability.
Property tax is primarily calculated via three processes – unit area system, capital value system, and annual rental system. Depending on the municipality, the calculation process applicable can be different. However, the computable elements are mostly similar under all methods.
- Property type – Residential or commercial property or a land
- Occupancy status – Self-occupied or rented
- Locality details
- Age of the property
- Carpet area and floors
When individuals visit the website of their concerned local authority for tax payment, they can navigate to the option to calculate the amount online. They are required to enter all the correct details for an accurate calculation of property tax online.
However, the following is the most common formula utilised –
Property tax = Age factor x base value x building type x built-up area x category of utilisation x floor factor.
Once the amount is calculated, assesses can move to the next step.
Now, they can select the ‘Property Tax’ option, and choose the correct property type from the given details.
Next, they need to enter the serial number for their property tax or revenue survey or khatha. They can find this number from the previous year’s tax bill as well. After this, individuals also need to select the accurate assessment year, that is, the timeline for which they wish to pay the house tax.
Once the selection is complete, a form would appear on the screen asking for all the details about the individual’s property. These details can include the name of owners, type of use, total area, etc. Property owners should pay attention to providing accurate details while filling up the form.
After providing all these property details, individuals will be asked to confirm them and submit.
Now, individuals can proceed to pick their preferred payment method. In general, most municipal corporations provide payment options like a credit card, debit card or internet banking. On choosing the preferred method, they would be redirected to a payment portal for process completion.
Through this portal, individuals can complete their property tax online payment.
On completing the transaction successfully, the individual would receive a receipt or challan of the tax paid. It is advisable to print this receipt out and store safely for future references.
This challan is a vital document when filing ITR on property sales. Moreover, if individuals need to avail a secured loan against the property’s mortgage, they need to submit past tax receipts as well. Besides, while obtaining a tax exemption on loan against property, these previous years’ receipts are also required to be presented along with other documents.
Nonetheless, property owners need to know all the possible procedures to avail tax benefits on their loan against property.
As for such advances, individuals should always look for a lender that can offer affordable interest rates, flexible tenor and other advantages. As these are long-term debt tools, borrowers should also be cautious about their EMI affordability to avoid any risk of repayment default. This way, and by adopting other measures, they can ensure that no default arises on their loan against property or any other advance.
Furthermore, some lenders also provide pre-approved offers to make the process of financing hassle-free. These offers are available on various financial products like home loans and loans against property. Applicants can view their pre-approved offer by entering their name and contact number online.
To sum it up, paying tax on a property is mandatory as per government regulations. Also, if individuals are buying a property from an existing owner, they should carefully check all the tax receipts to ensure that they are fully paid. Moreover, to avoid all the hassles, homebuyers can pay TDS online and enjoy property ownership without any encumbrance.