Mumbai Property Tax | Calculation, Penalty Charges, Due Dates, Rebate and Receipts

Mumbai Property Tax: A compulsory fiscal charge levied by the government upon the payer, which in order funds government spending and other expenditures, is called tax. Not paying tax is an unlawful crime that can lead the taxpayer to evade taxes to jail. Taxes may be classified into direct and indirect depending on how they are imposed upon the taxpayers. The practice of taxation first started in Egypt around the period of 3000 to 2800 BC.

Taxes are usually charged based on an individual’s income and his corporate outcome. However, different countries often impose various sub-units of tax, and one of them is property tax. An ad valorem tax upon the property’s value is called a property tax and is usually levied by the governing bodies of the jurisdiction where the property is located. The governing authority can be a federal government, a federated nation, a municipal corporation or even a simple geographical location.

In India, we have strict legislation which operates the task of imposing a tax on the payers. Often, the education system is being held at gunpoint for not educating the students about the country’s tax system.

However, this article will give a deep look into the online tax payment Mumbai and the Navi Mumbai property tax online payment along with the BMC property tax receipt. Our topic of discussion will be based on the city of Mumbai, and the tax rules present there.

Mumbai Property Tax

Calculation of Mumbai Property Tax

Earlier, MCGM used the rate value system for calculating property tax. In this, the payable tax was fixed based on the rent from that property in a year, resulting in low returns for the government due to the low property charges appointed by the Rent Control Board.

Hence, the MGCM now follows the capital value system. In the new system, tax is calculated based on the Ready Reckoner rate.

The government helps the MCGM fix the rate. They revise it yearly hence, keeping the rate realistic and helping MCGM evaluate the property based on various parameters. The multiple parameters mentioned here are location, construction age and type, Flood Space Index and others. Hence, the formula for calculating tax property is

Property Tax = Tax rate × Capital Value

Here, the property tax is a certain part of the capital value, and the capital value depends on the base value. Hence,

Capital Value = Market value of the property × Built-up area × Age factor × Type of building × Category of use × Floor Factor.

The various factors mentioned above in the formula is represented by weights. The weights for respective parameters are discussed below.

Weight for type of building in units

  • RCC construction and Bungalows = 1 unit
  • Structures other than RCC = 0.60 units
  • Lands under construction or vacant = 0.50 units

Weight for age of property in units

  • Construction time period before 1945 = 0.80 units
  • Construction period between 1945-1985 = 0.90 units
  • Construction period after 1985 = 1 units

Weights for category of use

  • Hotels and similar types of establishments = 4 units
  • Shops, offices and other commercial buildings = 3 units
  • Factories and industries = 2 units
  • Units of residence and charity = 1 unit.

These units keep changing and hence, one should keep a good look of the website.

Property Tax Payment Procedures

The MCGM provides the citizens of Mumbai with both the online and offline options to pay their property taxes. In order to pay the tax online one can pay the tax it through the MCGM/BMC’s online portal or through the MCGM/BMC’s citizen login portal. For payment through the online portal one has to follow the steps

First step is to visit the online portal.

Second step is to click on “pay property tax” just below the online services.

The thrid step is to provide the property account number.

The fourth and the final step is click on the make payment option.

For payment through the citizen login portal one has to follow the steps

The first step is to enter the official website of MCGM.

The second step is click on the property tax button. The payers will be redirected to the Citizen Portal property tax page.

The third step is to enter the property account number and the captcha to login.

The fourth step is of furnishing off all the information required. After this the payer will be again redirected to a new page where they can check yes raise pending dues if any.

The last and the final f step is to verify the details and out the amount one has to pay.

The MCGM also provides the option for offline payment of property tax. The offline payments can be done at the BMC Help Centers, the revenue officer’s office or the Citizen facilitation centers. After the payment is completed the MCGM issues a receipt which of use both offline and online as well as is an important piece of evidence which proves the real ownership of the property.

Due Dates, Penalty Charges and the Receipt

The due date for tax payments is 30th June. The date has been revised. Earlier it was 31st March. If the pax payer fails to pay on the due date then the person is imposed with penalty of two percent on the payments of the next month. Apart from this there are no other such penalty charges.

The MGCM provides the tax payers with a receipt or chalan after the payment is completed. The receipt for the old payments can be downloaded by the tax payers by following the steps

The first step is to enter the BMC online portal.

The next step is click on the “Online Service” tab.

Then the tax payer has to click on the “property tax details” from the drop-down list which will be followed by the last step of clicking on the “receipt of” option.

Apart from this the tax payers can so receive their tax payers bill via emails also. This was done by the BMC due to outbreak of the pandemic if COVID-19. Hence, now the tax payers can get their tax property bills via emails once they have completed the KYC form. Here are the steps one needs to follow to complete the transaction.

Step 1: First the tax payer has to visit the MCGM online portal.

Step 2: Enter the account number, the captcha and then click on the login button.

Step 3: This step requires uploading the documents and the attested file.

Step 4: Now the tax payers provide their email id or contact details so that they can receive property tax bills online through mails or via SMS.

Step 5: Once the process is completed and approved then the tax payers will recieve a confirmation through their emails.

Rebate on the Property Tax

The rebate on the property tax can be done in the following cases

If the residential unit is up to 500 sq feet then there will be no property tax implied on the unit.

If the residential unit is between 500l1 and 700 sq feet then it can seek a 60% reduction in tax rates.

If the property is used for community services, charitable works, religious works then the property cannot be imposed with a property tax.

Also, if the residential unit is dedicated to a diplomatic or counsellor of a foreign then it cannot be levied with a property tax.

Early Bird Scheme

Brihanmumbai Municipal Corporation introduce the early bird scheme. In this scheme, a two percent concession of tax is provided by the civic body for those tax payers who have payed the half yearly within 30th June.

Four percent concession is provided to those who have paid their second installment by 30th June. There rebate can also be used by tax payers who don’t have any dues left with the government.

Takeaway From This Article

The article will help it’s young readers in knowing the tax system of our country. They will get to know how the property tax amounts were and are calculated, what ways are there to pay the property tax, how to receive the chalan after tax payments and even also the concession provided by the government itself.

The article will also help them in knowing making the right property decisions in future.

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