MCD Property Tax

If you own a property in any of the metropolitan cities in India, you must be well versed with the term property tax. property tax is a recurring tax that homeowners have to pay every year.

Municipal Corporation of Delhi - MCD Property Tax

MCD stands for the Municipal Corporation of Delhi. Owners of residential properties in New Delhi are required to pay property tax to the Municipal Corporation of Delhi (MCD) every year. Property tax is essential for the municipal governing authority as it is an important source of revenue. This revenue collected, in turn, is utilised to provide the basic civic services.

Based on the area or colony in which your property is located, you would need to pay your property tax to MCD. MCD is itself divided into North MCD, South MCD and East MCD. Further, the entire city of Delhi is divided into eight categories from A to H based on the value of properties in the colonies belonging to each of these categories.

Property Tax in Delhi is charged by the Delhi Municipal Corporation on all land and property including vacant land as long as it comes under its purview.

As recommended by the Government of India, MCD computes property tax on the basis of Unit Area System. This method takes into consideration the built-up area, the period of construction, the structure of building, location of property and use of property. The computation method is the same for all kinds of properties., It is the property tax rate which varies for residential, rented residential, commercial and industrial properties.

Formula for MCD Property Tax Computation

As mentioned, the MCD uses the ‘Unit Area System’ for property tax calculation all over the city. The formula used for calculation is as follows:

Property tax = Annual value x Rate of tax
Annual value = Unit area value per sq metre x Unit area of property x Age factor x Use factor x Structure factor x Occupancy factor
Rate of tax: Tax rates for properties in categories A to H are published by the MCD every year.
Unit area value: This is an assigned value per sq metre of the built-up area of a property. The unit area value per sq metre differs for categories A to H.
Unit area of property: The built-up area (not the carpet area) in sq metres is taken into consideration for computation.
Age factor: Newer properties are taxed higher than older ones, based on the age of the property. The value of this factor ranges from 0.5 to 1.0.
Use factor: Residential properties are taxed lower than non-residential ones. The value for residential properties is ‘1’.
Structure factor: RCC constructions are taxed higher than low value constructions.
Occupancy factor: Properties that are rented out are taxed higher than self-occupied ones.

For vacant land, annual value is calculated on the basis of this formula:

Unit area value per sq metre x area of vacant land x Use factor x Occupancy factor x 0.3

Note: If different portions of the building are put to different uses or the building has been constructed in stages, the annual value needs to be computed for each such portion separately.

Due Date, Penalty and Other Rewards

With respect to Rebate:

If your property tax is paid as a lump sum in a single instalment during the first quarter of the year, you will be eligible to receive a rebate of 15 percent on your total tax amount.
A rebate amounting to 10 percent of the annual value is given to DDA/CGHS flats, but only up to 100 sq metres.
A rebate of 30 percent is given to senior citizens, women and the physically challenged, but only on one property.

With respect to Delays:

In case of delayed payment of your property tax, the MCD will levy a one percent fine every month on the unpaid amount.
The DMC announces a deadline by which time all taxes must be paid.

Payment Process of MCD Property Tax

The most convenient way to making your property tax payment is through online banking. Simply visit the official website of MCD at mcdpropertytax.in/index.php where you will need to choose from the following three links, based on your area’s municipal corporation:

South Delhi Municipal Corporation (SDMC)
North Delhi Municipal Corporation (NDMC)
East Delhi Municipal Corporation (EDMC)

Post selection, you can follow these mentioned steps in detail:

Select the tab online services on the bottom-right of the page.
Find the property tax section and select online filing of property tax return.
Enter your Property ID in the box provided. You can find your Property ID on older property tax challans/receipts. If you don't have a Property ID, click on the link at the bottom of the page.
If you have your property ID, submit and go on to the next page. If you don't, you will have to fill out the form with all the details relating to your property.
You will be directed to a page containing information about your property under an ownership details document that is generated based on the information you have input and an automatic calculation will tell you how much you have to pay as tax.
Choose one of the payment options (cash, cheque, DD). There is an option to take a print out; it is recommended that you do. You can also edit the ownership details report in case something is wrong.
Click on Generate Challan (but make sure your details have all been entered correctly) and the official challan will be displayed and is ready to print.

Note: If you don't wish to pay the property tax online, you can pay it at one of the 800 strategically placed ITZ cash counters all across Delhi.

Exemption or Concession from Payment of Property Tax

Exemptions

Building or vacant land exclusively occupied and used for public worship, public burial or cremation grounds, heritage lands or buildings or occupied and used by any society or body for charitable purpose.
Agricultural land and building except dwelling houses.
Land or building vested in the corporation in respect of which the property tax be leviable primarily on such corporation.
Property owned by war widow or a Gallantry Award Winner being permanently used for self-residence and no portion is let out.
Property martyred on police or paramilitary duty.
Owned by South MCD employee handicap (fully) on duty.
Award-winning in international games.

Concession

A concession of 30% is given to senior citizens, women and the physically challenged.
Rebate of 30% to Ex-servicemen.
Rebate of 20% to group housing flats up to 30th June of financial year.
Rebate of 10% to DDA/CGHS residential up to 100 sq mts of covered or build up area.

Conditions for Availing Concession

Rebate is applied for a maximum of 200 sq meters of total build up or covered area except in case of DDA/CGHS residential which has a different limit.
Occupancy factor or use factor should be residential.
Use factor should be self-occupied.
In case of joint owners, rebate will be applied to the property share of owners who are under a rebate category.

Frequently Asked Questions

What is MCD Property Tax?

Owners of residential properties in Delhi are liable to pay property tax to the Municipal Corporation of Delhi (MCD) every year. This is known as MCD property tax.

How to pay MCD property tax?

You can pay MCD property tax online by registering your property at the official website of MCD – mcdpropertytax.in/index.php. If you don't wish to pay the property tax online, you can pay it at one of the 800 strategically placed ITZ cash counters all across Delhi.

Is it safe to pay the tax via credit card?

Absolutely, it is safe to use your credit or debit card to pay your property tax.

Is municipal tax and property tax same?

No, property tax is a type of municipal tax charged by the governing municipal body.

What is your property ID?

A property ID is an ID which is required to submit while paying your property tax

How the MCD property tax is calculated?

The MCD property tax is calculated on the mentioned formula ‘Property tax = Annual value x Rate of tax’.