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Municipal Corporation of Delhi Property Tax

Last Update Date : November 27, 2018

Property Tax, also known as Municipal Tax, is a tax imposed by the central government on the properties (like a factory, home, shop, commercial building) in a particular area which falls under the horizon of the Municipal Corporation. The agenda behind the collection of this tax by the Municipal Corporation is to utilise this money for maintenance of the city, for example, for the maintenance of roads, public parks, hospitals, sewage system, etc.

Property Tax in Delhi

Property Tax in Delhi is managed and collected via three Municipal Corporations. They are:

  1. South Delhi Municipal Corporation (SDMC)
  2. North Delhi Municipal Corporation (NDMC)
  3. East Delhi Municipal Corporation (EDMC)

Each MCD covers a certain area in the city thereby comprising the city. One needs to check in which jurisdiction of MCD his property falls into. One needs to pay his respective Property Tax by the deadline declared by the MCD to avoid any penalty every financial year.

Categorisation of Property Tax

A city is divided into various categories depending on the living standards of the people residing in that location. For example, Delhi is categorised into eight subparts; coming under the category of “A” to category of “H”. Category A, B, C and so on will be categorised as the posh areas of the city whereas places coming under the category of F, G, and H will be considered as places where the cost of living is comparatively low. Properties coming under the category of H are imposed with the least amount of tax and vice versa (Tax rate of residential property in category H is 7% whereas it is 12% in category A). One needs to check in which category (A to H) in a particular Delhi MCH, i.e. South Delhi Municipal Corporation, North Delhi Municipal Corporation, and East Delhi Municipal Corporation, his property falls and then file the property tax accordingly.

Property Tax Rates

Property Tax Rates vary as per the type of property (i.e. residential, commercial, industrial and institutional) and its category (A to H) in which it falls into. Below are the Property tax rates in Delhi 2018-2019 of commercial and residential property.

Category Commercial Property Residential Property
A 20% 12%
B 20% 12%
C 20% 11%
D 20% 11%
E 20% 11%
F 20% 7%
G 20% 7%
H 20% 7%

Required Information for Filing Property Tax

  1. Property ID, for which one can refer the receipt of the property tax of the previous year (when paid earlier)

If one does not have the property ID; one needs to register the property with the municipal authority and get this number generated.

For those who are about to pay property tax online for the first time, they need to fill in the details of their property (at MCD website after selecting the option “First Time Online Tax Payers”) such as:

  1. Ownership details
  2. Property Address Details
  3. Contact details of the property owner
  4. Bank details of the property owner
  5. Building details (floor no., covered area, use factor, structure factor etc.)

The above information is required so that their details get stored and if and when they log in to the site the next time they need not fill in their details again.

How does MCD calculate Property Tax?

In Delhi, a modern method, Unit Area System is applied to calculate the property tax. The formula of the same is;

Property tax = Annual Value x Rate of tax

Residential Property

Property tax = Annual Value x Rate of tax

To calculate the Annual Value of the property the following formula is used:

Annual Value = Unit Area Value x Use factor x Structure factor x Age factor x Occupancy factor x Flat factor

The above Unit Area Value is attributed as the value per square meter of the total built-up area of the property (For a Category “A” it is Rs. 630 per square meter whereas it is Rs. 100 per square meter for category “H” property)

Use factor is the usage of property depending on its use, be it residential or non-residential. Higher taxes are imposed on non-residential properties.
Structure factor is the type of construction [i.e., Kuchha, Semi-Pucca, and Pucca (RCC Building)]. Its value ranges from 0.5 to 1(Kuchha is allocated the value of 0.5 whereas Semi-Pucca and Pucca are allocated the value of 1).

The age factor is the age of the property. Older properties are taxed lesser in comparison to the newer properties. Its value ranges from 0.5 to 1, as per the age of the property.

Occupancy factor takes into account whether a property is self-occupied or rented out. Rate of tax varies as per the category (A to H) under which the property falls into.

Commercial Property

The formula for calculating the Property Tax for Commercial Property is same as of the Residential Property. The rate of tax differs here, which is 20% irrespective of any category (A to H) of commercial property.

Property tax = Annual Value x Rate of tax

To calculate the Annual Value of the property the following formula is used:

Annual Value = Unit Area Value x Use factor x Structure factor x Age factor x Occupancy factor x Flat factor

Property Tax Rebates

Below are the conditions where you will be given a rebate on your Property Tax

  1. If you pay your tax online, you will get a rebate of 2% on your Property Tax.
  2. Paying it within the first quarter without instalment will fetch you a rebate of 15%.
  3. If you are a senior citizen, a physically challenged person or a woman owning a property which is self- occupied for the residential purpose having an area of up to 200 square meters then you are granted a rebate of 30% only on one such property.
  4. DDA/CGHS residential property up to 100 square meters of covered area is given a rebate of 10%.
  5. Ex-servicemen are granted a rebate of 30%.
  6. 20% rebate is granted to Group Housing Flats up to 30th June of a financial year.

How to pay Property Tax Online

Property Tax can be paid online by visiting the official MCD website (1)

  1. Choose your corporation (South Delhi Municipal Corporation, North Delhi Municipal Corporation, and East Delhi Municipal Corporation)
  2. Put a tick on Terms & Conditions section once you have read it then click on ‘Click here to file property tax’ key
  3. After feeding the value of your property ID, you will be directed to the next page where you need to feed your ownership details (if you do not have a property ID click on the option where it mentions paying it for the first time)
  4. After entering the details of your property, your tax will be automatically calculated, and you need to click on submit
  5. You can pay the tax by net banking, Debit card or Credit card as per your choice
  6. Now you can get the print out of your challan and store it for future references.

How to pay Property Tax Offline

Pay a visit to any of the authorised ITZ “In-the-zone” Cash Outlet in Delhi and make your payment. You will be issued a receipt having your property tax ID. Two banks HDFC and Axis Bank also provide this service.

HDFC Bank – Cheque payment is accepted by all branches in Delhi and NCR.

Cash payment is accepted by 19 branches in the city (One can refer to these branches by logging on the website of MCD)
Axis Bank – Accepts the payment in Delhi and NCR branches only.

Due Date and Penalty

For the financial year 2018-19 the deadline for paying Property Tax is July 15. Failure of the same will lead to penalty charges, which is charged at 1% per month.

Report Grievances

One can lodge grievance by providing the details of the payment on the website of the MCD (2) by clicking on the section “Grievances” and feeding the details such as Property ID, contact number, name of the taxpayer and the mode of the payment. Status of the same can be figured out by logging on to the same page by feeding the Property ID and the Grievance ID.

Property Tax Return Forms

Property Tax Return Forms can be viewed by logging on the website. (3)

Here under the section of PTR FORM, you will have subsections having Detailed PTR Form, Annexure of PTR, Schedule of Taxes, Single PTR Form and General Information.

People Also Ask

Q. What is Property ID?

A. It is a unique number assigned to a particular property (residential, commercial or institutional) by the Municipal Corporation of that region.

Q. Where can I find my property tax number?

A. You can find it on your receipts/challan of your Property Tax or by logging on the website of the concerned authority.

Q. If I fail to pay to my Property Tax this financial year, will I be imposed a fine?

A. Yes, on the failure of payment of your Property Tax you will be liable to pay penalty, which is charged at 1% per month.

Q. Are there any benefits of paying Property Tax online?

A. Yes, on paying your Property Tax online, you get a rebate of 2%.

Q. What is the Unit Area System for calculating Property Tax?

A. It is a modern method of calculating Property Tax. In this system, a city is divided into various categories as per the living standards of that particular area (keeping posh areas of the city into the highest category and vice versa). Every category gets assigned a Unit Area Value by the government, depending on the location, age and type of the property.

Q. If one does not pay Property Tax for a few years then what are its consequences?

A. Municipal Corporation of Delhi imposes a charge on your property. Without clearing off this charge, you will not be able to sell off this property in the future. Also if you wish to avail loan on this property, banks will not give you a loan without clearing off your property tax as they ask for receipts of Property Tax.

Q. How can I get maximum concessions on my Property Tax?

A. Below are the conditions where you will be given a rebate on your Property Tax.

  1. If you pay your tax online, you will get a rebate of 2% on your Property Tax.
  2. Paying it within the first quarter without instalment will fetch you a rebate of 15%.
  3. If you are a senior citizen, a physically challenged person or a woman owning a property which is self- occupied for the residential purpose having an area of up to 200 square meters then you are granted a rebate of 30% only on one such property.
  4. DDA/CGHS residential up to 100 square meters of the covered area is given a rebate of 10%.
  5. Ex-servicemen are granted a rebate of 30%.
  6. 20% rebate is granted to Group Housing Flats up to 30th June of the financial year.

How can H&R Block help you?

Saving taxes and filing income tax return accurately becomes very easy when you have professional help. This is where we come into the picture. We have a team of in-house tax experts who can file your tax return accurately while giving you maximum tax benefits.

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