{"id":3247,"date":"2022-01-19T13:07:58","date_gmt":"2022-01-19T13:07:58","guid":{"rendered":"https:\/\/www.homebazaar.com\/knowledge\/?p=3247"},"modified":"2026-04-28T12:42:25","modified_gmt":"2026-04-28T12:42:25","slug":"property-tax-guide-in-india-2022","status":"publish","type":"post","link":"https:\/\/www.homebazaar.com\/knowledge\/property-tax-guide-in-india-2022\/","title":{"rendered":"Property Tax Guide In India 2026 Calculation, Types & Online Payment"},"content":{"rendered":"What are the Property Taxes in India<\/b><\/h2>\n
In India, the property tax is applicable as per the Income Tax Act 1961. The tax is applicable while buying the property, during the ownership of the property, and when selling the property.\u00a0<\/span><\/p>\nHere is the general distribution of the applicable property tax in India for buying, selling, and owning the property. <\/span><\/p>\n![\"property](\"https:\/\/www.homebazaar.com\/knowledge\/wp-content\/uploads\/2022\/01\/Property-tax.jpg\")
<\/p>\n
Property Tax on Buying a Property<\/b><\/h2>\n
When you purchase a new property, you need to pay the property tax in India. These taxes are GST and Stamp Duty Registration Charges. <\/span><\/p>\nGST On Property in India<\/b><\/h2>\n
GST on property in India is charged only on under-construction properties.<\/span><\/p>\n\n- 1% GST for affordable housing<\/span><\/li>\n
- 5% GST for other residential properties<\/span><\/li>\n<\/ul>\n
No GST is charged on:<\/span><\/p>\n\n- Ready-to-move properties<\/span><\/li>\n
- Resale or old properties<\/span><\/li>\n<\/ul>\n
Also, ITC (input tax credit) is not available on residential property under the current rules.<\/span><\/p>\nHighlights-GST On Property in India<\/b><\/h3>\n\n\n\n| Under-construction property<\/span><\/td>\n | 1%-5%<\/span><\/td>\n | 1% for affordable housing and 5% for other residential properties.<\/span><\/td>\n<\/tr>\n\n| Ready-to-move property<\/span><\/td>\n | 0%<\/span><\/td>\n | No GST after the completion certificate is issued.<\/span><\/td>\n<\/tr>\n\n| Commercial property (under construction)<\/span><\/td>\n | 12%\u00a0<\/span><\/td>\n | Higher GST may apply depending on usage.<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\nStamp Duty and Registration Charges\u00a0<\/strong><\/h2>\nStamp duty and registration charges are mandatory costs you need to pay when buying a property in India. These are government charges and form a major part of the total property cost.<\/span><\/p>\n\n- Stamp duty is a tax charged by the state government on property transactions.<\/span><\/li>\n
- Registration charges are paid to register the property in your name.<\/span><\/li>\n<\/ul>\n
\n\n\n| Charge Type<\/b><\/td>\n | Rate<\/b><\/td>\n | Details<\/b><\/td>\n<\/tr>\n\n| Stamp Duty<\/span><\/td>\n | 2% to 7%<\/span><\/td>\n | Depends on the state location and property value.<\/span><\/td>\n<\/tr>\n\n| Registration Charges<\/span><\/td>\n | Around 1%<\/span><\/td>\n | Paid to the sub-registrar’s office.<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n In total, these charges can add around 5% to 10% of the property value to your overall cost. <\/span>The exact property tax rate in India for stamp duty varies by state and is calculated based on the property value or circle rate, whichever is higher.<\/span><\/p>\nStamp Duty and Registration Charges in Major Cities<\/strong><\/h3>\n\n\n\n| City\u00a0<\/b><\/td>\n | Male<\/b><\/td>\n | Female<\/b><\/td>\n<\/tr>\n\n| Mumbai\u00a0<\/span><\/td>\n | 5%<\/span><\/td>\n | 4%<\/span><\/td>\n<\/tr>\n\n| Navi Mumbai\u00a0<\/span><\/td>\n | 6%<\/span><\/td>\n | 5%<\/span><\/td>\n<\/tr>\n\n| Thane<\/span><\/td>\n | 6%<\/span><\/td>\n | 5%<\/span><\/td>\n<\/tr>\n\n| Pune\u00a0<\/span><\/td>\n | 7%<\/span><\/td>\n | 6%<\/span><\/td>\n<\/tr>\n\n| Bangalore<\/span><\/td>\n | 3%-5%<\/span><\/td>\n | Same as male<\/span><\/td>\n<\/tr>\n\n| Chennai<\/span><\/td>\n | 7%<\/span><\/td>\n | 7%<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Stamp duty rates may vary based on property value location, and state rules. The above data is indicative and can change as per government updates.<\/p>\n Property Taxes During The Property Ownership<\/strong><\/h2>\nOnce you own a property, you may need to pay annual property tax. to the local municipal authority. This is one of the main property tax in India and is used for services like roads, drainage and public infrastructure.\u00a0<\/span><\/p>\nProperty tax applies to:<\/span><\/p>\n\n- Residential properties<\/span><\/li>\n
- Commercial properties<\/span><\/li>\n
- Rented or vacant properties<\/span><\/li>\n<\/ul>\n
The amount is decided by the municipal body based on factors like property size, location usage, and value.<\/span><\/p>\nWhat is Included in Property Tax<\/span><\/h3>\nProperty tax is not just one charge. It includes multiple small components, such as:<\/span><\/p>\n\n- General tax.<\/span><\/li>\n
- Water tax.<\/span><\/li>\n
- Sewerage and drainage charges.<\/span><\/li>\n
- Lighting or infrastructure charges.<\/span><\/li>\n<\/ul>\n
These components may vary from city to city depending on local municipal rules.<\/span><\/p>\n\n\n\n| Factor\u00a0<\/b><\/td>\n | Details<\/b><\/td>\n<\/tr>\n\n| Type of tax<\/span><\/td>\n | Annual municipal tax<\/span><\/td>\n<\/tr>\n\n| Who collects it\u00a0<\/span><\/td>\n | Local municipal authority<\/span><\/td>\n<\/tr>\n\n| Payment frequency<\/span><\/td>\n | Yearly or half-yearly\u00a0<\/span><\/td>\n<\/tr>\n\n| Depends on\u00a0<\/span><\/td>\n | Location, size, usage and property value\u00a0<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\nProperty Tax Calculation<\/b><\/h2>\nThe property tax is calculated by the municipal authorities of the specific region. Different municipal authorities have used different property tax calculation methods.<\/span><\/p>\nGenerally, the property tax in India is calculated based on the following three methods.\u00a0<\/span><\/p>\n![\"property](\"https:\/\/www.homebazaar.com\/knowledge\/wp-content\/uploads\/2022\/01\/Asset-5.png\") <\/p>\n
Capital Value System (CVS)<\/b><\/h3>\nThe Capital Value System is used in Mumbai. In this method the Capital Value System (CVS) the annual property tax is computed based on the Market value of the property. In Mumbai, the Ready Reckoner rates are considered the market value of the property. The Municipal corporation releases the ready reckoner rates every year.\u00a0<\/span><\/p>\nThe Property Tax formula can be given as-<\/span><\/p>\nProperty Tax = Capital Value X Property Tax Rate<\/b><\/p>\n The formula to calculate the capital value-\u00a0<\/span><\/p>\nCapital Value For Land<\/span><\/p>\nCapital Value (CV) = BV x UC x FSI x AL<\/b><\/p>\n Where,<\/span><\/p>\nBV = Base Value As per Ready Reckoner Rate\u00a0<\/span><\/p>\nUC = User Category<\/span><\/p>\nFSI = Floor Space Index<\/span><\/p>\nAL = Area of Land<\/span><\/p>\nCapital Value for the Flats can be calculated as<\/span><\/p>\nCapital Value (CV) = BV x UC x NTB x AF x FF x CA<\/b><\/p>\n Where:<\/span><\/p>\nBV = Base Value As per Ready Reckoner Rate<\/span><\/p>\nUC = User Category<\/span><\/p>\nNTD = Nature and Type of Building<\/span><\/p>\nAF = Age of the Building<\/span><\/p>\nFF = Floor Factor<\/span><\/p>\nCA = Carpet Area<\/span><\/p>\nExample For Calculating the Property Tax on a Flat\u00a0<\/b><\/p>\n Consider the following property details to calculate the applicable property tax with the Capital Value System (CVS)<\/span><\/p>\nReady Reckoner Rate = Rs 50,000\/ Sq mt<\/span><\/p>\nUser Category = Residential Property (0.5)\u00a0<\/span><\/p>\nNTB = 1 For RCC building\u00a0<\/span><\/p>\nAF = 0.95 Age Factor 9-10 years Old Building<\/span><\/p>\nFF = 1.0 (1-4 Floors)\u00a0<\/span><\/p>\nCarpet Area = 100 Sq mt<\/span><\/p>\nTAx Rate for Residential Properties in Mumbai = 0.755%<\/span><\/p>\nSo the capital value will be<\/span><\/p>\nCapital Value (CV)<\/b> = BV x UC x NTB x AF x FF x CA<\/span><\/p>\n=\u00a0 50,000 X 0.5 X 1 x 0.95 X 1 X 100<\/span><\/p>\n= Rs 23,75,000<\/span><\/p>\nTotal Property Tax<\/b> = 0.755%\u00a0 of 23,75,000<\/span><\/p>\n= Rs 17,931<\/span><\/p>\nUnit Area Value System (UAVS)<\/b><\/h3>\nThe Unit Area Value system is the modern method for calculating property tax. It does not depend on the market value or the rental value of the property and, therefore, gives an accurate calculation of the property taxes.\u00a0<\/span><\/p>\nThis method for calculating the property considers the age of the property, the location of the property, and the type of the property.\u00a0<\/span><\/p>\nIn the unit area value system, the localities are categorized based on livability ratings.\u00a0<\/span><\/p>\nProperty Tax Calculation Formula by Unit Area Value System<\/span><\/p>\nProperty Tax = Annual Value X Tax Rate<\/b><\/p>\n The Annual Value can be calculated as\u00a0<\/span><\/p>\nAnnual Value =<\/span> Area Covered X UAV X Use Factor X Age Factor X Structure Factor X Occupancy Factor X Flat Factor\u00a0<\/b><\/p>\nWhere,\u00a0<\/span><\/p>\nUAV<\/b> = Unit Area Value per Square Meter; it depends on the property category. (Between 100- 630) (Categories AH)<\/span><\/p>\nUse Factor <\/b>= It is the factor assigned based on the property use. Between 1-10, for residential property, it is 1<\/span><\/p>\nAge Factor = <\/b>Depends on the age of the property. New properties have a higher age factor. Usually between 0.5 and 1<\/span><\/p>\nOccupancy Factor = <\/b>Depends on whether the property is for self-use or has been rented out. Occupancy Factor 0.6-2<\/span><\/p>\nFlat Factor = <\/b>It is the total area covered by the flat.\u00a0<\/span><\/p>\nArea Covered =\u00a0 <\/b>Indicates the total area covered by the property.\u00a0<\/span><\/p>\nThe Tax rate depends on the total categories made by the multiple authorities. In Delhi, the Tax rate is between 7-20% of the annual value of the property.\u00a0<\/span><\/p>\nConsider an example- You own a flat in Delhi with a UAV of Rs 400, Category C, and the total area of the property is 90 sq meters. You purchased the property in 2002. And you are using the property for your own use.\u00a0<\/span><\/p>\nIn this case-<\/span><\/p>\nUAV = Rs 400 per sq ft<\/span><\/p>\nUse Factor = 1.0 since it is residential property<\/span><\/p>\nAge Factor = 1.0 since the property was bought after 2000<\/span><\/p>\nStructure Factor = 1.0 for RCC Building<\/span><\/p>\nOccupancy Factor = 1.0 for self-occupied<\/span><\/p>\nThe property tax can be calculated as-\u00a0<\/span><\/p>\nProperty Tax = Annual Value X Tax Value<\/b><\/p>\n Annua<\/b>l<\/span> Value <\/b> | | | | | | | | | | | | | | | | | |