With a booming economy, a huge influx of corporates and increasing job opportunities, the future of Chennai’s residential market looks bright already. From affordable luxury houses to budget homes, the city has residential properties that cater to all financial statuses, making it a smart choice for homebuyers. If you are looking for a favourable realty market and a smooth purchase, here is a checklist for buying a property in Chennai.
No matter which city you live in, owning a house comes with a lot of responsibility. One of them is paying the tax levied on the property to contribute to the bettering of living conditions in the city. If you own a property in Chennai, here is a quick guide for you to understand property tax and how to pay yours responsibly.
What is Property Tax?
Property Tax is a local tax imposed on the owner of a real estate property annually or semi-annually by the local government bodies such as the Panchayat or the Municipal Corporation. Also called the House Tax, this amount is assessed by the local governing body depending on the size of the property, the area of the building, the construction, the location, etc. The tax is also inclusive of taxes on resources like light, water, and drainage facilities. The tax money from property owners then goes to the maintenance and bettering of public services like roads, schools, sanitation, and sewage facilities. Residential buildings, office buildings, shops, flats, factory buildings, and godowns are the types of properties on which this tax is imposed.
The following are the factors that affect property tax:
How is Property Tax Calculated in Chennai?
The Greater Corporation of Chennai is the authority in charge of collecting property tax in Chennai. It follows the concept of Reasonable Letting Value (RLV) to estimate property tax, according to which, the annual rent of the property is estimated according to the basic rate per square feet. This basic rate is determined by the corporation.
Monthly RLV = Plinth area x Basic Rate/ sq. ft
Annual Value = Monthly Rental Value x 10.92, where 10.92 is a fixed common value fixed by the corporation to calculate the annual value of the building.
The Annual Value also depends on the size of the property, its location, amenities, and proximity to civic amenities.
The Greater Chennai Corporation’s website has an online property tax calculator that makes your property tax calculation easy. By filling in details such as the type of ownership, the name of the street, ward number, etc, your property tax can be computed easily.
Assessment of your Property Tax
Your property tax can be assessed both offline and online. Follow these steps to assess your tax offline:
Online Assessment
Your tax assessment application can be submitted online through the online citizen portal. All you have to do is create a user ID and password and fill in details such as the location of the property, your name, door number, contact number and your complete address.
Where to Pay Property Tax in Chennai?
The Greater Chennai Corporation facilitates the payment of property tax in a user-friendly manner. Follow these simple steps to pay your property tax online.
You can pay your taxes offline through the office of Revenue Officer, Assistant Revenue Officer, tax collectors, e- Seva centres run by TACTV Corporation, banks (authorized banks only) and e-seva centres of TACTV corporation.
Central Government buildings, as well as foreign mission buildings, are exempted from property tax. Though private schools and colleges also used to enjoy exemption from the same, this was lifted in March 2018. The due dates for tax payment are September 31 and March 31. Failure in payment results in a penalty of 5- 20 per cent. Property tax is a major source of revenue for local authorities to maintain public services, which makes the payment of property tax a moral obligation for citizens. The government even gives discounts for early payments to encourage people to fulfil their legal obligations. With facilities to assess your property tax at the click of a button, payment of property tax is now easy and fast. All you need to have are the details of your property and access to the respective authority’s website.
*TACTV collaborates with Government by running e-seva centres to help people can avail government services.
In India, it is appropriate to define affordability in housing as being a function of three broad parameters - the monthly household income (MHI) of prospective buyers, the size of the dwelling unit and the affordability of the home buyer (the ratio of the price of the home to annual income or the ratio of EMI to monthly income).
As per the regulations of Income Tax Act 1960, certain payments and investments such as tuition fees of children, charitable donations, provident funds, education loans, medical expenses of disabled family members, and so on can help you claim your tax benefits. For homeowners, home loans are the biggest source of tax benefits.
Property registration is the most important and the final stage of a home buying process or a property transfer. Once the property is registered in your name, it’s official: you own the house! However, learning about property registration should not be put off until the last minute. As a potential homeowner, being informed about the procedure will help you keep you when it is time.
If you are a prospective homebuyer in pursuit of a fair deal, you will very often come across terms like Built-up area, Super built-up area, and Carpet area that are used quite frequently by your real estate agent. As they describe the area inside the house at your disposal, you do not want to be at a loss when you chance upon these terms during the course of your purchase.