Explaining Property Tax in Detail


According to the latest data, it has been observed that the average revenue collection from property taxes in India is comparatively lower than in other countries. Since the tax is used for various purposes such as maintaining roads, sewage systems and infrastructure facilities, paying property tax on time is necessary to help the Government perform its duties.

Property tax is mainly imposed by the local municipal authorities where the property owners are required to pay an annual or monthly fee for development purposes. Even though the tax percentage varies from one state to another, the calculations and certain rules and regulations are similar.

For new property owners, understanding such tax calculation methods and their aspects might be challenging initially. Therefore, it is wise to go through the basics before getting into its intricacies. This way, not only taxpayers get to understand the minor details related to property tax but also the process of paying house tax online. 

Calculation of property tax

Even though this calculation procedure is mainly dependent on municipal authorities, the basic aspect remains property valuation. You can find three key ways to calculate your house tax, which is mentioned below:

  • Annual rental value system

Under the RVS system, you get to find the annual rental system to calculate the value of the property and tax as well. The value is dependent on certain factors like size, location, amenities, etc., and it is decided by the authority itself. 

  • Capital value system

Here the market value plays a vital role since property tax will be levied based on that. A specific tax percentage will be levied considering the present market value of your property and the locality. Individuals are also required to pay heed to these necessary aspects from the very beginning, as receipts of property tax payments can ease loan against property applications for the concerned property. 

  • Unit area value system

Under this particular arrangement, you are required to pay taxes, which are usually imposed on the per-unit price of the built-up area of your house. The system is followed by top metropolitan cities where the price per unit is fixed depending on the expected returns. 

After the inauguration of various digitalisation methods, paying taxes within a stipulated time has become relatively easier. Also, late payments eventually draw hefty fines. 

If taxes remain due, LAP loan borrowers may face credit rejection as well. Just as credit score can affect their loan against property eligibility, so can the non-payment of property taxes. Apart from knowing the calculations, property owners should also know how to pay property tax online

Steps to pay house tax online 

In order to pay your property tax, follow this simple procedure:

  • Log in to the online portal of your city or municipality corporation to begin this process and proceed with choosing a property tax payment option. 
  • You are also required to choose from the property category and assessment year for which you will be paying this property tax. 
  • Make sure to fill in with an accurate property identification number, owner’s name and other necessary details.
  • Choose a payment mode and clear your dues. 

The documents and receipts obtained after making each payment can be used while availing property loans from any lending institution. Nowadays, individuals are relying on such easy financing options to consolidate all other dues. In this regard, one should understand what is debt consolidation and how it helps in reducing the financial burden. 

Also, with pre-approved offers from reputed HFCs, financing has now become hassle-free and quick. These offers are available on several products like home loans, loan against property, etc. Therefore, you can easily check your pre-approved offer and maximise the mortgage loan benefits. 


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