Guide to Paying MCD Property Tax in Delhi

Property tax is a repeat tax that home owners have to pay yearly. However, the amount you have to shell out as tax differs from one region to another. The article serves as a guide for property taxes that Delhi homeowners have to pay to MCD.

People who hold ownership of residential properties in Delhi are required by law to pay yearly property taxes to the Municipal Corporation of Delhi (MCD). Based upon the location of your house, you will have to pay taxes either to the North Delhi Municipal Corporation (NDMC), the South Delhi Municipal Corporation (SDMC) or the East Delhi Municipal Corporation (EDMC).

It is also worth mentioning that Delhi is partitioned into eight categories ranging from A to H depending upon the location of the colonies and the value of properties in those localities. The rate at which the tax is charged and unit area value (assigned value per sq metre of the property) is different for all the localities that are divided into eight categories.

Guide to paying MCD Property Tax in Delhi

Calculation of Property Tax in Delhi

The Municipal Corporation of Delhi employs the ‘Unit Area System’ for calculation of property tax in Delhi. The formula is mentioned as following:

Property tax = Annual value x Rate of tax

Where

Annual value = Unit area value per sq metre x Occupancy factor x Age factor x Unit area of property x Use factor x Structure factor

And

Rate of tax = the rate fixed by MCD for all the categories ranging from A to H.

Tax rates for different categories are published by MCD every year.

Unit area value= this is an assigned value per sq metre of the built-up area of a property. The Unit area value per sq metre is different for different categories.

Unit area of property is the total built-up are and not carpet area of the property.

Age factor: Prepare to pay more if your property is new as the tax rate applicable is more for newer properties. The value of this factor falls between 0.5 to 1.0.

Use factor: Again brace yourself to pay more taxes in case your property falls under the residential category as taxes for residential properties are higher than that of non-residential properties. The value for residential properties is ‘1’.

Structure factor: tax rates for RCC constructions are higher than that for low value constructions. RCC stands for reinforced cement concrete and contains embedded steel bars, called reinforcement bars, or rebars along with plates, or fibers that strengthen the material.

Occupancy factor: Property that you use for your own accommodation will be taxed lower. On the other hand, higher property tax will be charged if you have rented out your property.

Rebates on Property Tax

Certain concessions or rebates are allowed by Municipal Corporation of Delhi (MCD). You can claim deduction on your property tax if you meet any of the following criteria.

If you pay your property tax at one go during the first quarter of the year, MCD will offer you a concession of 15 per cent on your total tax liability.
DDA/CGHS flats, up to 100 sq metres are given a discount of 10 per cent by the MCD.
Senior citizens, physically handicapped and women are given a rebate of 30 per cent on property owned by them. This, however, applies only to a single property. What it means is that if a physically handicapped or senior citizen owns two properties, he will be given 30 per cent rebate only on one property and for the other property he has to pay his taxes in full.

How Do You Pay Your MCD Property Tax?

The most convenient and simple way to pay our property tax is to pay it online on MCD’s website. You can use your credit card, debit card or net banking facility for the same. In recent times, MCD facing criticism from different quarters has ramped up its website and made significant improvements and technological upgrades to facilitate quick and convenient online payment.

Once you go to the MCD’s website, you will need to click on any one of the below mentioned three links depending upon your area’s municipal corporation:

You need not worry even if you do not know under which corporation your colony falls as all the three corporations have mentioned in the website all the colonies falling under their respective jurisdiction.

Also, it is of utmost importance to note that failure to pay your property tax will make you liable for fine. MCD charges one per cent fine every month on the unpaid amount. For example, if your total tax liability is INR 100 and you have paid only 50, then in that case MCD will charge 1 per cent fine on the unpaid 50 rupees.

After you have made the payment, you also need to ensure that the payment is showing against your property. You have to check carefully to make doubly sure that outstanding amounts are not shown against your account. If there is an error and system does not reflect the payment you have made on the MCD’s website, you need to get in touch with concerned authorities immediately. It is better to have the error rectified as soon as poosible to negate any chances of further harassment or inconvenience.