All You Need to Know About Property Tax

Property tax is a mandatory charge levied by the government on any property or land. Owners have to pay an annual tax to the Municipal Corporation, or a government-approved body in their area.

Properties and estates that are liable to pay the tax are as follows –

• Commercial and residential buildings. 
• Rented houses. 
• Attached houses. 

Municipal authorities are known to calculate property tax based on a property’s value. Three methods used to calculate such taxes are as follows –

• Rateable Value System (RVS) – This process calculates taxes based on the annual rental value of any given property. It is decided by the municipal authority based on location, size, condition, amenities, etc. 
• Unit Area Value System (UAV) – This calculation process takes into consideration the per-unit price of the build-up area. 
• Capital Value System (CVS) – It is based on the total market value of any property and is republished every year after revision. 

Municipalities later introduced online taxpaying facilities. It not only simplifies the taxpaying process but also aims to facilitate specific features for those who pay property tax online. This includes –

• Timely tax payments. 
• Easy access to tax records for homeowners when filing for an income tax report. 

It is advised that you pay your taxes on time if you intend to avail loans in the future. Financial institutions review your tax reports, especially when applying for a loan against property. The brief overview of property tax should provide the necessary information homeowners require to start calculating and paying their taxes.