In India, property tax is a major source of revenue for urban local bodies. Municipalities within a state administer these taxes, which are then used for various amenities.

Likewise, property owners in Delhi are subject to pay this tax on an annual basis. To simplify this process for taxpayers, we present this comprehensive guide on property tax in Delhi. 

Without further ado, let’s begin!

The Municipal Corporation of Delhi, or MCD, levies a tax on all properties under its jurisdiction. This tax is charged on all sorts of real estate, including buildings and vacant land.

Therefore, owners of any property, whether residential, commercial, self-owned or rented out, are liable to pay MCD property tax.

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For MCD property tax calculation, the Municipal Corporation of Delhi adopts the Unit Area System.

Further, it employs a formula to calculate the amount of tax payable by a real estate owner. 

Here is the formula, take a look:

Property Tax = Annual value x Rate of tax

Confused? Don’t worry; we’ll break this down for you:

1) Annual Value - MCD calculates a property's annual value by way of this formula:

Property Tax = Unit area value per square metre x Structure factor x Age factor x The covered area of property x Use factor x Flat factor x Occupancy factor

Allow us to offer you a clearer picture of this formula by delving into each of the factors mentioned above: 

• Unit area value per square metre: It depends on a property’s category. Keep reading to learn more about this.
• Structure factor: It is based on the construction of a property.
• Age factor: It falls on a scale of 0.5 to 1. Newer properties in Delhi attract higher taxes than older ones. 
• The covered area of property: This indicates the total floor area of a property.
• Use factor: MCD assigns this factor based on the usage of a property.
• Flat factor: It depends on the total covered area by a flat.
• Occupancy factor: It is based on the occupancy of a property - whether it is rented out or self-occupied by its owner.

2. Rate of tax - MCD segregates the city of Delhi into eight categories from A-H. These categories are marked as per the valuation of properties in each locality.

The rate of MCD property tax calculation, therefore, differs with each of these categories. This variance in tax rates as of 2023 is highlighted below:

MCD facilitates the payment of taxes via offline and online routes, making the process extremely convenient and efficient for taxpayers. We will now shed light on both of these modes of tax payment:

MCD Online Tax Payment

MCD property tax online payment can be made by following these steps:

• Visit the official website of MCD to initiate MCD house tax online payment.
• Now choose between EDMC, NDMC, or SDMC to pay taxes to your respective Municipal Corporation.
•  Click on “Property tax” option available in “Online Services” tab.
• In the required space, enter the property ID and choose the year for which property tax need to be paid.
• Now click on ‘First time online taxpayer’ if an individual is paying for the first time.
• Provide the necessary information and click on ‘Submit’ option.
• Now, you will notice an ‘Action’ option against each property. Select this option and then on the link ‘Use this property to pay tax.’
• You can pay MCD property tax online either via a debit/credit card or net banking.
• Finally, click on the ‘Generate Challan’ option to download the MCD property tax receipt.

Offline Payment Process

Alternatively, you can pay your tax at one of the 800 ITZ cash counters that are strategically placed all across Delhi. An instant MCD property tax receipt is issued on the completion of the payment. Furthermore, this receipt contains a property tax ID that comes in handy during future tax payments.

Additionally, the entire property tax in Delhi is to be paid in one lump sum before the first quarter of a given financial year. Therefore, you must pay your due MCD property tax online or offline before the last date of payment, i.e., June 30.

For ease of administration, the Municipal Corporation of Delhi (MCD) is divided into several zones, namely the following:

• North Delhi Municipal Corporation (NMCD)
• South Delhi Municipal Corporation (SMCD)
• East Delhi Municipal Corporation (EMCD)
• West Delhi Municipal Corporation (WMCD)

Numerous individuals and bodies enjoy exemption from property tax in Delhi, such as:

• Vacant buildings or lands serving as a place of worship, heritage site, public burial, or used for charitable purposes.
• Property belonging to individuals martyred on paramilitary/police duty
• Agricultural land/building (dwelling houses are not included)
• A sportsperson who has received awards in international games
• Property owned by a winner of the Gallantry Award or a war widow who uses the entire property for self-residence 
• Property owned by an employee of South MCD who is fully handicapped

MCD offers a rebate on property tax in the following cases:

• A 30% rebate to senior citizens, ex-servicemen, physically challenged individuals, and women on one property and up to 200 square metres.
• 15% rebate if tax is paid in a lump sum by a taxpayer during the 1st quarter of the applicable financial year.
• 10% rebate to CGHS/DDA flats for up to 100 square metres and on the annual value.
• A rebate of 20% to owners of group housing flats who pay their MCD property tax before June 30 of a given financial year.

However to avail these rebates, it is necessary meet the following conditions:

• It is applicable for residential properties or should be used for self-accommodation.

• For jointly owned property, the rebate would be split among owners, depending on their share in the property.

On that note, we have reached the end of this guide. We hope that it resolved all your doubts and queries so that you can enjoy a seamless payment of your property tax in Delhi.