Just bought a house? All you need to know about house tax, how it is calculated

Property tax (also known as house tax) is the annual sum property owners have to pay to the local government or the municipal corporation of their area. All kinds of tangible real estate properties attract property tax, such as house, office building, and land/flat rented to others. When you purchase a house, you need to pay property tax to the local municipal authority. The tax is collected by the local municipal authorities for maintaining service and civic amenities such as roads, parks, sewer systems, and street lights. The tax rate differs on the city and zone the property is located in. The method for calculating the tax also varies with different municipal authorities. If you have recently bought a house, here is what you need to know about property tax: Procedure for filing property tax Step 1: Visit the office of your local municipal corporation or a bank designated by the municipality. Step 2: Provide your property tax number for identifying the property that is to be taxed. Step 3: You can also pay the property tax online via the website of the respective state government or local municipality. It should be noted that the late payment of property tax can attract a fine in the form of interest on the due amount. Calculation of house tax There are three ways through which the property tax is calculated: Capital Value System In this system, the municipal authority calculates the tax that has to be levied on the property based on its market value. The property’s value is decided by the government, and it is changed yearly on the basis of property’s location. Annual Rental value System The property tax in this system is computed in line with the property’s annual rent value. It is not the actual rent collected on the property. It refers to the fixed rental value decided by the municipal authority, depending on factors such as size, location, or condition of the house. Unit Value System In this system, the property tax is levied on the per unit price of the carpet area or built-up of the property. The price is fixed on the basis of expected returns from the property in accordance with the location, price, and usage. You should contact your local municipal office to know more details about the house tax, and the basis it is calculated on, in your area. Read all the Latest News , Trending News ,  Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.