What is Property Tax_WC
The additional taxes and charges you pay at the time of buying your property are typically a one-time occurrence, but property taxes are an annual remittance you have to bear as the cost of owning the property. This fee is levied by the local civic body, which could be either the local Panchayat, or the Municipality Corporation. The revenue generated from the property tax collections is used to pay for infrastructural developments at a microscopic level, such as sewer and drainage system improvements, development and upkeep of public spaces and other civic welfare programs. The revenue generated from the property tax collections is used to pay for infrastructural developments at a microscopic level, such as sewer and drainage system improvements, development and upkeep of public spaces and other civic welfare programs.
Property taxes are imposed on all types of real estate including commercial and residential buildings, attached land and land renovations, barring vacant plots with no adjoining buildings.
Read Also: Tax Benefits on Loan Against Property
Several factors play a role in the total property tax amount you pay as a property owner. Some factors stay uniform across the country, while others are unique to specific localities and regions. Read on to learn more about the determinants of property taxes:
- Property Location
- Property Size
- Status of Property Construction
- Gender of the Property Owner
- Age of the Property Owner
- Lifestyle Amenities of the Property
Three types of taxing systems have been devised based on these parameters:
- Unit Area Value System: This system broadly considers the built-up area of the property in question.
- Annual Rental Value System: This system accounts for the annual rental value of the property, considering its location and attached amenities
- Capital Value System: In this system, the tax is calculated based on the property’s estimated market value.
A select group of property owners may be exempted from paying property taxes because of special allowances made for them by the governing bodies. They include:
- Senior Citizens
- Disabled Individuals
- Former Armed Forced Personnel
- Families of Martyred Defence Personnel
*Terms and conditions apply
Frequently Asked Questions (FAQs)_WC
Frequently Asked Questions (FAQs)
Property tax in India is charged on the value of real estate property, including homes, buildings, and land. Local authorities such as municipal corporations, panchayats and municipal councils levy property tax. Income tax, on the other hand, is levied on the income earned by individuals, business owners or corporations. The tax is imposed by the central government based on the total income earned during the financial year.
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