November 2017 – Page 3 – FindMyProperty

Here, we’re providing you a guide to pay property tax in Delhi. The people, who own residential or non- commercial property in Delhi, are accountable to the Municipal Corporation of Delhi (MCD) to pay property tax every year. The MCD has been divided into various sections based upon the location of property i.e. SDMC (South Municipal Corporation of Delhi), NDMC (North Municipal Corporation of Delhi), and EDMC (East Municipal Corporation of Delhi). Besides, Delhi is divided into another eight categories, depending on the property values in that location or colony from A to H. For these eight categories, the rate of property tax along with the unit area value varies for all the eight categories.

calculation of property tax for a residential property in Delhi:

For the calculation of property tax in Delhi, the MCD uses the following formula known as ‘UNIT AREA SYSTEM’:

Property tax = Annual value * Rate of tax

(Annual value = Unit area value per sq meter * Unit area of property * Age factor * Use factor * Structure factor * Occupancy factor)

Rate of tax: For the categories A to H, rates for property tax are published by MCD every year.

Unit area of property: It is the constructed area which is taken into consideration for the calculation of the property tax. It is computed in square meters.

Unit area value: The variable values assigned per square meter for the constructed area of a property for categories A to H.

Age factor: Depending upon whether the property is old or new, this factor varies from 0.5 to 1.0.

Occupancy factor: Rental properties or lent out for any commercial purpose are often liable to pay higher tax than the self occupant ones.

Use factor: Non- commercial properties are taxed lower than the commercial ones.

Structure factor: Depending on the construction material and the structure of the building, RCC buildings are rated higher than the others.

Rebates on property tax in Delhi

On some of the property tax payments in Delhi, the MCD offers rebates:

You can avail a rebate of 15% on the total tax amount, if you pay your property tax as a hole in one go within the first quarter of the year.
Upto 100 sq meters of DDA/CGHS flats, you can receive a 10% rebate on the annual value of your property tax
30% rebate on one property is given to women, senior citizens or physically challenged.

Paying your property tax in Delhi

For the most convenient way of paying the property tax is paying it online on the MCD website either through internet banking or credit/debit cards. To encourage the online payments, MCD has invested appreciably to make the sites more efficient and advanced.

After visiting the MCD website, you need to choose form the following options depending upon the location of your property.

The categories A to H are divided amongst these three corporations and you can visit their respective websites for further queries.

If you fail to pay the property tax on time, you are liable to pay 1% of Property tax per month on the unpaid amount. As soon as you make the payment online, check for the system that it has updated all your records and no unpaid amounts are shown against the account. Get the errors (if any) corrected immediately.

To avoid friction as tenants and landlords, there are certain rules and rights everyone should be aware of. So, here is a simple look at some commonly overlooked aspects.

In case of rental accommodations, tenants often face disputes with their landlords regarding minor things. Therefore, it is important to know and respect your rights as tenants as well as landlords to live in harmony.

Simplest requirements which the landlord (licensor) is supposed to provide to the tenant (licensee):

The proper details of the licensed area, like: size of the premises along with the availability of various other facilities such as car parking etc.
Compliance to cooperate for getting all the documents (the leave and license agreement) properly stamped and registered at the sub- registrar’s office.
To allow the incessant, safe and private use and occupation of the mentioned, licensed property to the licensee.
To provide clear right, title and interest to the licensee.
Tenants should properly inspect the property it for any defects, make a note of it and share it with the landlords before they rent it.
All the plumbing systems, electrical fittings, and other provisions in the apartment must be in usable condition. And this need to be checked by the tenants beforehand
Some tenants might also ask for some repairs or paint jobs to be done in the property before shifting.

Who pays for repairs in a rented apartment?

According to the experts, ideally, the licensor for the landlord is supposed to bear all the costs which arise out of wear and tear and any kind of structural damage which is caused to the premises, since the monthly license fees are enjoyed by them.

However many or rather most of the parties agree to the thing that when the licensor bears the costs of any long-term structural damage, the regular wear and tear is borne by the licensor or the tenant.

When should the deposit be handed over to the landlord?

While the tenant moves to into the rented property, he/she usually gives an advance as a security to the landlord as the Deposit. Deposit serves the purpose for the landlord in case of any damages or non- payment by the tenant. The payment period for the deposit is usually discussed at the time of signing the agreement with the landlord. Administrative fees are typically included in the deposit. All the reasons for which the deposit can be deducted must be mentioned in the agreement. After the completion of tenancy period, the deposit is returned to the tenant after applying all the deductions (if any).

How much can my rent be increased?

Any increase in rent is completely based on the understanding between the licensor and the licensee. As per the law strictly, there isn’t any restriction on the increase. But, the licensee must negotiate to settle on fair conditions, wrt to the increase of the rent.

Under what condition the tenant can be asked to vacate the property?

The tenant can be asked to vacate the property under two conditions:

Eviction with a cause and
Eviction without a cause

In the words of Dhruva: “In case of eviction without a cause, the landlords can allow the tenants the pre- decided notice period, to look for any alternate accommodation.” In majority of the cases, the cause for eviction can be any of the following:

Non- consistent paying of the payments
Violation of terms or conditions discussed in the agreement.
Taking place of any illegal activities on the leased property.
Damage to the rental property.

Paying property tax in Delhi – Some simple and helpful steps