When you own a property, you need to pay property tax to the government. This is a mandatory fee collected by the government to fund local infrastructure projects and services. In India, property tax is collected by the local civic bodies or municipalities.
If you own a property in Bangalore, the Bangalore Development Authority (BDA) is the governing body that collects property tax. In this article, we will provide a complete guide to BDA property tax applicable for loan against property in India.
What is the BDA property tax?
BDA property tax is the tax collected by the bangalore development authority on properties located within the Bangalore limits. The property tax is based on the annual value of the property, which is determined by several factors including size, location, and usage.
Why do you need to pay BDA property tax?
Paying property tax is your responsibility as a property owner. The property tax that you pay is utilised by local authorities to provide basic services like sanitation, water supply, street lighting, and maintenance of public gardens, among others.
Moreover, it is mandatory to pay property tax to avail of various benefits like transfer of property title, building plan approval, and mortgage loans, among others. In case you default on paying property tax, you can be subjected to legal action and penalties.
How is BDA property tax calculated?
The BDA property tax is calculated annually based on the annual value of the property. Annual Value (AV) is the estimated rent that the property can fetch if it were to be leased out. The following factors are considered to arrive at the annual value.
- Unit area value (UAV)
The government determines the Unit Area Value (UAV) based on the guidance value of the property. Guidance value is the minimum price at which the property can be registered with the local sub-registrar office. UAV is the prescribed value per square foot of the property, which varies depending on the locality and the type of property. - Built-up area of the property
The built-up area of the property includes all carpet area, balconies, and utility space. The area is calculated in square feet. The calculation also includes the depreciation value used to arrive at the net annual value (NAV) of the property. - Usage of the property
Depending on whether the property is for residential, commercial, or industrial use, the applicable tax rate is determined. The tax rate for residential properties is lower compared to commercial properties. - Age and condition of the property
The age and condition of the property are also considered. In general, older properties pay less tax as they have depreciated in value over time.
What are the applicable taxes?
The BDA property tax comprises three different types of levies:
- One-time levy: This is a one-time tax that is charged at the time of registration of the property. In Bangalore, the one-time levy is 2% of the guidance value of the property.
- Improvement levy: The improvement levy is payable if the property has undergone any renovation or remodelling from the date of registration. The rate of improvement levy varies from 5% to 50% depending on the extent of enhancement.
- Annual property tax: The annual property tax is paid by property owners on the value of the property. The rate of annual property tax is between 0.05% and 0.2% of the annual value.
How to pay BDA property tax online?
The BDA property tax can be paid both online and offline. To pay BDA property tax online, follow the steps below:
- Visit the official website of BDA – www.bdabangalore.org
- Choose the ‘Online services’ option and then go to the ‘Property Tax’ section
- Enter the property identification number (PID) and click on ‘Search Tax Details’
- Verify the details, including the tax amount
- Choose the payment mode – debit/credit card, net banking, or UPI
- Make the payment and download the payment receipt
Alternatively, you can also pay BDA property tax offline. Visit the nearest Bangalore one or Karnataka one centre and provide the property details and pay the tax in cash or through a bank transaction.
How to pay BDA property tax offline?
To pay BDA property tax offline, visit the Bangalore Development Authority (BDA) office or authorized banks. Obtain the property tax challan form and fill it with accurate details, including property identification number (PID) and assessment year. Calculate the tax amount based on the property's assessed value and applicable rates. Make the payment in cash or through a demand draft at the designated counters. Ensure all necessary documents are submitted along with the payment. Collect the receipt as proof of payment. Regularly check for updates on payment deadlines and procedures to avoid penalties or delays in property tax payments.
What are the penalties for late payment?
The BDA property tax should be paid on or before the due date. Failing to do so attracts penalties starting from 2% of the tax amount for the first 30 days after the due date. Thereafter, a penalty of 2% per month is added until the tax amount is paid in full.
Paying property tax is a legal obligation for all property owners. BDA property tax is a tax collected by the Bangalore Development Authority on properties located within the Bangalore limits. The tax is calculated based on the annual value of the property and the applicable tax rates.
It is important to pay BDA property tax on time to avoid legal consequences and penalties. By following the above-mentioned steps, you can pay the tax easily, both offline and online. We hope this guide on BDA property tax helps you understand its importance and how to pay it.
