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Property Tax of Hyderabad


Property tax is the annual amount paid by a land owner to
the municipal corporation or the local government of his area. The property
includes all tangible real estate property, his house, office building and the
property he has rented to others.

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Property tax is a :

Single largest source of revenue to the ULBs.
Constitutes about 20% of total municipal revenues of ULBs during
Constitutes about  43% of
internal revenues of ULBs during 2013-14.



If you own a residential house or apartment in is mandatory for you to pay
property tax to the Greater Hyderabad Municipal Corporation (GHMC). Municipal
bodies collect property tax annually or semi-annually to primarily facilitate
better public services such as road repairing, sanitation, and construction of
schools and other utility buildings.


Property tax is levied on both residential as well as
commercial buildings. Generally, property tax comprises taxes like lighting
tax, water, and drainage tax, and the tax amount is calculated based on the
location, type of construction, and physical dimension of the property.


For self-occupied residential properties, property tax calculation is based on
the rental value of similar properties in the same locality. For tenanted
property, Annual Rental Value (ARV) as stated in the rental agreement is
considered for tax computation.

of  Assessment Prior to 1989

Basis for fixation of
Annual Rental Value

Fair Rent fixed or
fixable in respect of buildings covered by Rent Control Legislation

Rent received for the

Rent fixed on
hypothetical basis in respect of buildings where Rent is not fixed.

Rent fixed on
hypothetical basis in respect of owner occupied buildings

Property Tax
– Components

a tax for general

a water tax;

a drainage tax;

a lighting tax; and

a scavenging tax

Rates of
Property Tax

buildings           :  25 % of  ARV

b.     Non-Residential Buildings  :  33% of ARV

c.     Library cess shall be collected at the rate of 8 paise for every rupee
in the property tax levied.

New Property
Tax System

Basis For Levy of Property
Tax : Annual Rental Value

Factors for fixation of
Annual Rental Value

1.Location of the building

2. Type of construction

3. Plinth area

4.  Nature of use

5.  Age of the Building

Objectives of  New System of Property Tax


To evolve a scientific method in the levy of Property
Tax in  the Municipalities.

To fix the Assessments in a uniform manner in respect
of  similar Buildings situated in one
locality and used for similar purpose.

To reduce the discretion and to avoid arbitrariness in
the  Assessment of Property Tax.

To simplify the Procedure of assessment

To make tax administration to be of more efficient and
effective in the levy of property tax. 

To provide relief to the buildings constructed under
weaker section Housing Scheme and to owner occupied residential buildings.

To improve the resources of the Municipalities by
Restructuring  the method of assessment
of Property Tax.


Age of the building

Deduction allowed
from ARV attributable to the building

25 years and below

10% of ARV

Above 25 years and upto 40 years

20% of ARV

Above 40 years

30% of ARV

Allowances for Repairs










of Action for Levy of Property Tax


Division of Municipality into zones.
Classification of buildings based on type of construction.
Further classification of buildings based on nature of usage.
Survey of prevailing rental values of 20% of rented buildings.
Consultation with State Property Tax Board
Consultation with elected representatives
Consideration of the objections and suggestions received from the
Issuance of public notice regarding levy of property tax for the first
Service of special notices.

constructed for Urban Poor


In respect of houses constructed for urban poor,
property tax shall be collected at one rupee per half-year


Residential Property Tax Calculation:


calculate your residential property tax, follow the following steps:

1: Measure your plinth area (PA). The plinth area is the
total built-up area, which includes all covered areas including balconies and

Step 2: Determine
the current rent-per-square-foot in the market for similar properties in your
area if the property is self-occupied. If you’ve rented the property out, you
must consider the rent per square foot as stated in the rental agreement. This
value is your Monthly Rental Value (MRV) per square foot.

3: Calculate your residential property tax with this

Annual Property Tax for Residential Property = PA x
MRV (per sq.ft.) x 12 x (0.17 – 0.30) depending on the monthly rental value –
10% depreciation + 8% library cess.

Commercial Property Tax Calculation:

Step 1: Measure
your Plinth Area (PA).

Step 2: The
MRV for commercial property is mentioned in the notifications distributed by
the GHMC for the fixed monthly rent per square foot in different circles in
different taxation zones. The MRV can be found at: GHMC Website Proposed
Division of Zones

3: Calculate the commercial property tax using this

Annual Property Tax for Commercial Property = 3.5 x
PA in sq.ft. x MRV in Rs./sq.ft.

4. Factors
for determination of Annual Rental Value New system of property tax envisages
fixation of annual rental value of buildings and lands and property tax thereon
with reference to the following factors:

a)     Location
of building

b)     Type
of construction

c)     Nature
of use

d)      Plinth area

e)      Age of building

5. Rate
of Property Tax   

tax is levied 30% on Annual Rental value (ARV) of Non residential  buildings.





















Property Tax – LONDON


upon the annual budget for City services which includes things
like funding Police, Fire and Ambulance Service, Roads, Sidewalks, Transit,
Parks, Trails, Museums, Recreation Centres, Libraries, and all City programs
and services;
Provincial taxes (to fund education).Property value is
assessed every four years by MPAC Tax rates
are applied to the current value assessment of each property as determined by
the Municipal Property Assessment Corporation (MPAC). Tax rates
vary for commercial, industrial and other classes of properties.

reassessed all Ontario properties for 2017 taxation based on 2016 market

The residential tax rate of 1.360444% breaks down as follows:

General rate is 1.181444%

Education rate is 0.179000%

 Assessed Value  x  Tax Rate =  Property Tax                                         

A municipality determines its budget requirements each
year.  If the average value for the properties  increase, the tax
rate decreases to keep the same amount of property tax levy.

Reassessments have no impact on the total property tax
amount a municipality raises.

This is
how property tax is spent in London :

87% to
the municipal and remaining 13% to the local school board

This is
the Municipal portion of property tax spent :



Operational  & council Services                   10.7%




Services                                                      3.9%

& Neighbourhood Services                            6.0%

& Development Services                                    1.2%

services (Police & Fire )                                  29.4%

& Health Services                                                    


Tax – Mumbai


Municipal Corporation (BMC) every year passed a proposal to exempt property tax
on houses in the city that have a carpet area of up to 500 sq ft. It also
proposed a 60 per cent concession in property tax, for houses measuring 500-700sq.ft.

The BMC uses the Capital Value System (CVS) to
calculate property tax. This CVS is based on the market value of the property.

Capital value is
calculated as follows:


Market value of the
property x Total carpet area x Weight for construction type x Weight for age of
the building

The market value can be ascertained using
the Ready Reckoner. The RR is set by the state government and is a
compilation of the fair value prices for properties. You will need to check the
ward/zone in which your property falls.

Weights for construction type in units:

•       Bungalows
and RCC construction – 1 unit.

•        Other than RCC (semi-permanent /chawls) – 0.60

•       Under-construction
or vacant land – 0.50 units.

Weights for ‘age of building’, in units:

•       Properties
constructed before 1945 – 0.80 units.

•       Properties
constructed between 1945 and 1985 – 0.90 units.

•       Properties
constructed after 1985 – 1 unit.

After you
have ascertained the capital value, property tax is calculated

•       Capital value of property x Current property tax
rate (%) x Weight for user category

•       Weights
for ‘user category’, in units:

•       Hotels
and like businesses – 4 units.

•       Commercial
properties (shops, offices) – 3 units.

•       Industries
and factories – 2 units.

•       Residential
and charitable institutions – 1 unit.



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