Yes, I envy you.
Everybody dreams of owning a house to secure their future and lead a carefree life. And if you have managed to have enough savings and plan to buy a house in the dream city of India, Mumbai then hats off to you my friend. I envy you.
But before you go house hunting, let me ask you a question!! Have you made long-term calculations? Buying a house is surely a one-time investment but paying taxes for the same isn’t and so while you set your budget to purchase a house in Mumbai, do make sure that you have included property taxes and accordingly calculate whether or not you will be able to pay the same taxable amount each year.
For thorough calculations, you will need to have a good understanding of how property tax in Mumbai works and so here I am with my exclusive details on Property Taxes in Mumbai. Let’s get started with-
Introduction to Mumbai Property Tax
Every year, the Mumbai government charges tax on the landowners expecting them to pay the tax on their real estate properties owned which include their house, office properties, or even the ones that are rented out to others. It is the Brihanmumbai Municipal Corporation (BMC)/ Municipal Corporation of Greater Mumbai (MCGM), who is responsible for collecting the property tax from the Mumbaikars.
By the way, did you know property taxes and their regulations are different for each state, so, continue paying attention to the following details so that you do not miss out on any important information
Calculation of Property Tax in Mumbai
Do you want to know how much you'd have to pay if you buy a property in Mumbai? Well, it is really easy to calculate your property tax value. Just follow up with the below-mentioned steps-
Step 1: Calculate Capital Value
Step 2- Calculate Property Tax
Calculate Capital Value
Capital Value= Market value of the property* Total Carpet Area* Weight for type of construction* Weight for age factor
- To determine the market value of the property, you can refer to the Ready Reckoner (RR). Basically, the RR is a list of fair market value prices for properties fixed by the state government.
- The Ready Reckoner provides the rates of built-up area per sq.mt and the same shall be used for the carpet area.
- Weights for Type of Construction, in units:
Bungalows and RCC construction- 1
Semi-permanent structures/ Chawls- 0.60
Under construction or vacant lands- 0.50
- Weights for Age of Building, in units
Properties constructed before 1945 – 0.80
Properties constructed between 1945 and 1985 – 0.90
Properties constructed after 1985 – 1
Now that you have ascertained capital value, property tax can be calculated as follows
Calculate Property Tax
Property Tax= Capital Value * Tax Rate* Weight for user category
- Weights for user category, in units
Hotels and like businesses – 4
Commercial properties (shops, offices) – 3
Industries and factories – 2
Residential and charitable institutions – 1
Calculation of Property Tax Online
If you find the above-listed formulas to be complicated, then you can opt for the online method. Follow the below-listed steps-
Step 1: Visit the MCMG Tax Calculator
Step 2: Fill in the required details such as Ward, Zone, locality, area, usage, occupancy type, total carpet area, year of construction, floor type, etc
Step 3: Click Calculate and it’s done, you will get the detailed property tax amount
Payment of Property Tax in Mumbai- Online
BMC has now given the option to pay online as per your convenience, follow these steps to make BMC Property Tax Payment Online
Here is a step-by-step guide to help you pay the tax online:
Option 1: Log in to the MCGM online website
- Enter the property number. You can find the number on your old tax bills. Choose an option if you want to view your outstanding bill payments or view the receipts or make the payment.
- Select an option appropriately and proceed with the payment. And you are all done!
Option 2: Log in to the BMC citizen online portal.
- Add your property account number and login. In case you are not aware of the property account number, click ‘search’ and you can enter your property name, address, building, and ward to search.
- Once you successfully log in, verify the property tax details of the property that show up on the screen and click ‘accept.’
- The outstanding tax amounts would then come up on the screen for all the year. You can now enter the amount that you want to pay and your outstanding balances would be therefore adjusted on a FIFO basis.
- Click ‘online payment’ and you will be directed to the payment page. Make the payment via net banking and save the receipt for the future.
Option 3: Login to NNMC online website and enter your property code to make the payment.
Payment of Property Tax in Mumbai- Offline
If opting for the offline mode of payment, you will have to visit the nearest Assistant Revenue Office or BMC centers or citizen facilitation center at all ward offices to pay the property tax.
Property Tax Bill on Email
Fill in the Know Your Customer (KYC) form online and get the property tax bill in the mailbox. All notifications, alerts, and tax bills will be sent to the registered email ID, once the KYC formalities are completed by the citizens.
Here’s how to do the KYC on the BMC property tax portal
Step 1: Visit MCGM Citizen Portal and enter your property account number.
Step 2: Enter the captcha and click on ‘login’.
Step 3: Upload the requisite documents and submit the attested copy.
Step 4: Enter the email ID and contact details for receiving property tax alerts through email and SMS.
Step 5: Once approved, you will get the confirmation in your email.
Exemption/Concession from Property Tax Payment
- Houses/Flats measuring less than 500 square feet are exempt from payment of property tax.
- Residential Properties between 501 sq. ft and 700 sq. ft are given a rebate of 60% on the property tax payable.
- Properties used as a public place of worship or for charitable purposes need not pay any property tax.
- Government notified properties of Diplomatic or Consular Mission of a foreign State.
Property Tax in Mumbai – Due Date and Penalty
- Due date for payment of property tax in BMC is 30th June
- Delayed payment will attract a penalty at the rate of 2% of the amount due for every month of delay.
Frequently Asked Questions
1. How often do you pay property taxes?
Property taxes can be paid once a year or twice a year.
2. What if I don't pay my property taxes?
If you don't pay your property taxes, the taxing authority may sell your home—or a lien on it—to pay off your debt. Alternatively, your mortgage lender may pay the taxes and then bill you for them. If you do not repay the mortgage lender, your home may be repossessed.
3. How can I find out what my local property taxes are?
For a more precise figure for your home, check the website of your local assessor or municipality, or call the tax office.