Property Tax in Mumbai – Process of Calculation and Online Payment

Earlier, the procedure for property tax in Mumbai was a bit challenging for property owners. It couldn't accurately determine their tax liabilities. It also made it challenging for the government to track payments and enforce collection. The system was also prone to corruption.

The Mumbai Municipal Corporation implemented a new system in recent years. The new Property Tax System in Mumbai has made the process more transparent and streamlined.

Process  Of Calculation Of Property Tax

New System versus Old System 

The previous taxation system was a fixed rate system. In the old system, the annual rent collected from the property determined the property tax. This resulted in low revenue for the Municipal Corporation of Greater Mumbai (MCGM) or Brihanmumbai Municipal Corporation (BMC) due to unrealistic charges imposed by the Control Board.

The new system of property tax in Mumbai by the corporation evaluates a property's worth based on the Ready Reckoner rate. This assigned Ready Reckoner (RR) rate gets revised annually to provide an accurate value.

Process Of Calculation 

You can estimate property tax in Mumbai based on several factors, including the location of the property, the age of the property, the carpet area, the floor space index (FSI), etc. Taking them into account, the BMC created a formula to assess the Mumbai property tax. With this, you can get tax for any property- residential, commercial, warehouses or retail shops.

The formula for calculating tax for a property in Mumbai is based on the capital value of the property. The property tax in Mumbai is found by multiplying the tax rate by the capital value. 

The MCGM (Mumbai Municipal Corporation) Property Tax is calculated using the below formula:

Mumbai Property tax = Tax rate x Capital value

The Ready Reckoner (RR) rate is set by the state government and depends on the market value of the property. The Revenue Department uses the RR rate to calculate stamp duty, which also depends on the district or zone in which the house is located.

The Calculation of Capital value is as below:

The capital value is determined by several factors, including the rate of the base value, the type of building, its age, usage, and floor. To determine the capital value, multiply the market value of the property by the following:

Total carpet area, user category, building type and weight for construction type.

Get the market value in the Ready Reckoner rate the government sets, which contains fair-value prices for properties.

Weights for construction types are:

• For bungalows and RCC construction, it is 1 unit.
• For semi-permanent/chawls, it is 0.60 units.
• For under-construction or vacant land, it is 0.50 units.

With the capital value obtained as above, calculate the property tax using the above formula. Multiply the current property tax rate and the capital value calculated in the formula above.  

To estimate Mumbai property tax:

Property tax is simple and easy to calculate. The property tax can be calculated online by entering the location, usage, and construction year on the BMC website.

Also, you can calculate property tax online by logging into the MCGM citizen portal:

• Visit the tax calculator on the MCGM citizen portal page.
• Enter the property details, including all other details. Such as ward, location, area, usage, occupancy type, carpet area, FSI, construction year, and floor type.
• Select "Calculate."
• The amount of the owing property taxes will appear on the screen.

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Making Payment For Property Tax In Mumbai 

You can easily pay the property tax online. A home, building, store, parking lot, and flats in Mumbai are all considered properties. The annual deadline for paying property tax in Mumbai is June 30th. The tax payment occurs once a year. There will be a fee of 2% for failure to pay the tax on time.

Online Payment Through BMC/MCGM Portal

In Mumbai, you can pay property tax both online and offline. The detailed instructions for paying taxes online on property in Mumbai are as below:

• Go to the BMC online portal using the citizen login portal.
• The webpage gets redirected to the official MCGM website. You can view all your unpaid and paid property tax bills there.
• Click on the "Online Services" tab and select "Pay Property Tax".
• Enter the property account number (found on the top of your previous property tax receipt). Choose whether to view "Outstanding Bills", "Receipts", or "Make Payment". If you don't know the account number, click "Search" and enter the ward, name, and address of your building to find it.
• Verify the displayed property details and click "Accept".
• The page displays the outstanding amount for each year. Choose the amount you want to pay. Click "Online Payment".
• The website only supports net banking. Choose your bank/payment gateway and click "Pay Now" to complete the property tax online payment.
• After payment, you can get the receipt for property tax. Save or print the receipt for future reference. To see the saved receipts, visit the "Online Services" tab and select "Receipts".

Concession Of Property Tax For Certain Properties

The following properties can experience a reduction of property tax:

• Places used solely for religious/charitable purposes are exempt from paying property tax.
• Properties owned by diplomatic or consular missions of foreign states. Those designated as such by the government are also exempt.
• Homes/apartments with an area of less than 500 square feet are exempt from paying property tax.
• Homes/apartments with an area between 500 and 700 square feet receive a 60% reduction in property tax.

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Property Tax for Mumbai in 2024

The property tax in Mumbai depends on the value of the property, as well as other factors. Such as the type of property, annual rent, and any additions or extensions made.

If you prefer to pay property tax in Mumbai offline, it is possible. You can pay at the nearest revenue office, BMC help centres, or citizen facilitation centre located at all ward offices. Paying online or offline, don't forget to include municipal taxes paid as a deduction. Deduct these property taxes from your house property income for income tax purposes.

Experience the convenience and efficiency of property tax online payment with a few clicks! Say goodbye to long lines and tedious paperwork. Switch to a seamless online payment system now available in Mumbai.