Chennai Property Tax

Property tax is levied on building and vacant land unless specifically exempted. The municipality that is entrusted with the task of regulating, managing and collecting property tax in Chennai is ‘The Greater Chennai Corporation’.

As per the regulation, Greater Chennai Corporation adopts reasonable letting value (RLV) to arrive at annual rental value (ARV) and this, in turn, is used to compute half-yearly tax for any property in Chennai City corporation limits. The monthly RLV is computed with reference to the basic rate per sq.feet fixed by the corporation for residential and non-residential properties depending upon the location of the property.

The basic rate ranges between Rs 0.60 per sq ft and Rs 2.40 per sq ft in the case of residential properties and between Rs 4 per sq ft and Rs 12 per sq ft in the case of non-residential properties.

Chennai Municipal Corporation

Chennai municipal corporation is divided into 15 zones. You can know your zone and division here.

It may be noted that Chennai property tax was last revised in the year 1998 and was due for revision every four years and should have been increased by 25% in case of residential property and 100% in case of commercial properties during every revision.

In August 2017 Madras High Court slammed Chennai municipal corporation for not revising the property tax rates since 1998 and as per the Court’s estimation, this non-revision has led to a revenue loss of over Rs 1500 crores.

The Madras HC has directed the municipal corporation to spell out the date by which property tax rates would be revised. However, presently municipal corporation officials are concentrating on rationalisation of property tax which would still increase the revenue by at least 150 crores every year and would like to take up the general revision of property tax after one year.

Formula for Chennai property tax computation

Half-yearly property tax is a percentage of annual value and 10% library cess on property tax. Percentage of half-yearly property tax is as follows:

Particulars	Half-yearly property tax %
Annual value between Re 1 and Rs 500	3.75%
Annual value between Rs 501 and Rs 1000	6.75%
Annual value between Rs 1001 and Rs 5000	7.75%
Annual value above Rs 5000	9%

The annual value of land and building

Chennai property tax computation takes into consideration the following factors in arriving at Annual value-

• Plinth area * Basic rate per Sq ft = Monthly RLV – Assuming 100 as plinth area and 1 Rs as basic rate monthly RLV is Rs 100
• Monthly RLV * 12 = ARV – Rs 100 *12 = Rs 1,200
• Deduct 10% from ARV attributable to value of land – Rs 1,200 – 120 = Rs 1080
• 90% of ARV less 10% depreciation on building – Rs 1080 – 108 = Rs 972
• Depreciated value of building plus 10% value that was attributable to the value of land =Annual value of land and building – Rs 972 + Rs 120 = Rs 1092

To put it otherwise, 10.92 is the common factor for calculating an annual value for all buildings. To arrive at the Annual value of any building, multiply MRV with 10.92.

The formula for arriving at ARV of superstructure only

10% *(MRV*12)

• Method of computing Annual value is different in case of a special type of buildings such as (a) nursing home/hospital (b) star hotels and lodging house (c) cinema theatre (d) Kalyana mandapam

Due date, penalty and other rewards

The Due date for payment of property tax is September 31 and March 31

Penalty at 1% per month is charged in case of delayed payment

Assessment of Property Tax

Online assessment
Citizens may submit an application for assessment of property tax through an online citizen portal available by creating a user id and password and furnishing the details such as division, name of the assessee, location of the property with complete address and contact number

Offline assessment

• The assessee shall submit a filled application form, copy of registered documents in his/her favour, and last tax paid receipt if any at any of TACTV counters located in Greater Chennai Corporation premises or concerned zonal offices/headquarters.
• An acknowledgement will be sent to the applicant through SMS for receipt of the request.
• The application will be scrutinized by the Assessor and he/she will measure the newly constructed building and a proposal will be submitted to the concerned officer.
• The proposal will be submitted to the Assessment Committee post field verification by the  approval officer
• An assessment committee will randomly select the proposals for scrutiny in order to verify the correctness of the assessments and approve the proposals post such scrutiny
• The committee approves and subsequently, the assessee receives the new assessment order(Notice 6). The assessments are also informed through SMS.

The above procedure can be followed even in case of modification of building, appeal with respect to property tax and transfer of property tax. New assessment order (Notice 7) will be issued in case of modification of property, Notice 10 in case of appeal and Notice 9 will be issued in case of transfer of property tax.

Steps for payment of Chennai property tax

Property tax payment can be made either online or offline. 

Online payment

• Visit www.chennaicorporation.gov.in
• Click on ‘property tax online payment’ under Online civic services
• Enter property location details which can be found on previous tax paid receipt and click on ‘submit
• By choosing ‘pay online option, pay either by using Credit Card, Debit Card or through Net Banking at a zero transaction fee

Offline payment

Cheque/demand draft shall be drawn in favour of ‘The Revenue Officer, Corporation of Chennai’ and make the payment through any of the following:

• Tax collectors
• Authorised banks (cash is also acceptable) i.e., Indian Overseas Bank, City Union Bank, Karur Vysya Bank, HDFC, IDBI, Canara bank, Tamilnadu Mercantile Bank, Kotak Mahindra Bank, Lakshmi Vilas Bank, Yes Bank and Indusland bank
• E-Seva centres (Common Service Centres) set up by Tamilnadu Government. Here is the List of CSC
• Tamil Nadu Arasu Cable Television Corporation (TACTC) established in all Taluk Offices of Chennai District

Exemption/Concession from payment of property tax

Exemption 

Properties owned by the Central Government and buildings occupied by foreign missions are exempt *Recently in March 2018 exemption given to private educational institutions was abolished.

Concessions:

• 20% rebate on monthly RLV in case of semi-permanent buildings
• 25% rebate on monthly RLV in case of owner-occupied residential buildings and 10% rebate in case of owner-occupied commercial portion of the building
• 1% depreciation is also provided every year for buildings more than 4 years old (subject to a maximum rebate of 25%).

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