Learn All About How GHMC Property Tax for Residential Properties is Calculated
Property tax is one of the most significant avenues of revenue generation for state governments. In line with that, individuals who own residential or commercial property in Hyderabad are levied with a property tax by the Greater Hyderabad Municipal Corporation each year.
GHMC property tax is collected on the basis of annual rental value of a property in question. The calculation for this property tax is different for residential and commercial properties.
Tax calculation for residential properties
To calculate GHMC house tax, individuals need to follow the steps below –
- Get a measurement of the plinth area. Plinth area is the total built up area which includes balconies and garages.
- After getting a measure of the plinth area, one will have to learn about rent per square foot of similar properties in the area, if a property is self-occupied. Otherwise, if the property has been rented out, rent per square foot has to be considered. This will give Monthly Rental Value (MRV) of a property.
- The GHMC tax will then be calculated by using the formula given below –
Annual residential property tax = Gross annual rental value x [(17% - 30%) the slab rate determined on the basis of the MRV – 10% depreciation] + 8% library cess.
Calculating the Monthly Rental Value of a property is also crucial for its valuation, which in turn allows individuals to gauge the quantum of loan against property they can avail, if the need arises.
April 21st, 2020