Humans are one of the most intelligent creatures on planet earth and have a very wide vision and planning. They can do anything and everything which they want and wish to. The history is the proof that there is nothing which a human cannot do. What was once thought as impossible is now possible and can be done in few seconds. For example, before few years, no one would have thought that it would be possible to order something from a store by sitting at home and having coffee.
Today, the same is possible, and that too, from the small screened phones which a person has in his or her pocket! This is the power of humans. But sometimes, this power can also be misused and harm people. The two world wars are examples of how humans can take the destructive form and destroy peace, humanity and everything around!
In order to check and control the humans, the government has come up with law and order and it executes the same. In order to maintain law and order, it has to have funds and so, it also lays some taxes. These taxes are used for the further benefit of the people and are invested for a better future! One such tax is property tax. The property tax is levied on these factors:-
1. Plinth area: – plinth area is the area which is covered by the whole flat. It includes the carpet area, the area of the outer and the inner walls, and any other construction which may be done inside the house. This is the factor on which the property tax is levied. This is often not known and it can create confusion. It is better to clarify and know then to have any doubts.
2. Rate of the street/ zone: – one should also know that the rate of the tax in a particular zone or street. It differs street to street as it depends on the locality, the no of buildings, the surroundings, etc. One should know the street rate and then they would get a fair idea about the rate of property tax to be paid.
3. Usage of the building: – it is Important to know that the usage of building acts as a pivotal role when calculating the tax amount. If the use is residential, then the rate maybe low and if the use is non-residential, that is commercial, it may have a higher tax rate. The rental agreement format in word would have a column asking for the usage!
4. Nature of occupancy: – the nature of the occupancy also matters. If the house is on rent, then it can be considered as a source of income and termed for non- residential use. If the owner is staying, it is the residential use! The nature of the occupancy also plays a role as if there is a tenant, then it is liable for taxation as he or she is acting as a source of income to the owner! There are many fully furnished apartments for rent in Chennai which would be used as a source of income as it would have tenants!
5. Age of the building: – the age of the building also matter while calculating the tax of the property. The older the building, the lesser the tax! This is because the new properties are more advanced and more expensive than the old ones. The price also differs significantly, therefore the newer would have higher rates!
Thus, the above are the factors which are considered while calculating property tax!