Bypassing any tax payment liability is considered to be a criminal offense under the Income Tax Act of 1961 as such payments are legally as well as statutorily binding for individuals. In case of a property tax, failing to pay it or delaying the process thus attracts penalty, wherein the defaulting individuals need to pay a fine of at least 1% to 2% of the outstanding amount every month. What is a Property Tax, and How is it Calculated?
So, to avoid such implications, property owners must pay their taxes in time and provide accurate tax details. Nevertheless, first-time property owners may find the entire process of computing and paying taxes quite complicated.
To simplify it, they should first become familiar with the underlying concept of property tax and the steps involved in the tax liability computation as well as payment of property tax bill online.
Property tax – A brief introduction
Tax on a property is an amount of money that landowners or property owners need to pay to the local government or concerned Municipal Corporation each year. One must note that the amount of property tax is based mainly on the property’s value. Also, it is payable only on properties that are with or without construction.
Property tax calculation methods
Before gaining information about business rate calculation, one should find out more about the factors that influence it.
For instance, these following are weighed in to calculate the value –
- Type of property, like land, residential or commercial.
- State, locality or Municipal Corporation of the property.
- Status of occupancy, like self-occupied or rented property.
The standard formula used to compute house tax is –
Property tax = Base value × Property age × Built-up area × Type of building × Floor factor × Category of use
Though the general overview of calculation is similar, different civic corporations may use different tax assessing methods. Some of the standard methods include –
- Annual rental value – In this method, tax is computed on the rent accrued from a property in a given year.
- Capital value system – Tax, herein, is calculated as a percentage of a property’s market value.
- Unit area system – In this method, computation is based on the per-unit price of a property’s built-up area.
Since computing calculation involves a series of steps, the chances of making manual errors are relatively high. Consequently, taxpayers should be careful when it comes to computing taxes before paying their land taxes online.
Individuals who plan to avail mortgage credits such as a loan against the property must find out the tax deductions and exemptions they are eligible to claim before calculating taxes.
Also, borrowers can lower their credit burden when availing such financing by availing a loan against property from a financier who provides credit at an affordable loan against property interest rate and is transparent about additional charges. It will help to understand the charges on their loan against property and manage them better.
Leading financiers also provide lucrative pre-approved offers to customers to make the process of availing a financial product worthwhile. In most cases, such offers can be availed on loans against property and home loans. Check your pre-approved offer online by entering just your name and contact details.
Step to pay property tax bill online
Step 1 – Visit the NDMC website.
Step 2 – Click on the ‘Sign up’ button to register.
Step 3 – Provide essential information.
Step 4 – Click on ‘Submit’.
Step 5 – Use relevant credentials to log in to this website.
Step 6 – Register your property by entering its Unique Property Identification Number.
Step 7 – Select property to pay taxes.
Step 8 – Pick a suitable payment gateway to pay property tax online.
Step 9 – Proceed to collect your property receipt online.
One must note that one can pay taxes on property through the designated websites of states or municipalities. Property owners must keep these things in mind while computing. Also, they should know how to access the bill online so that they can make payments accordingly as and when required.