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Odisha Property Tax

Odisha Property tax

Odisha Property tax

Property tax is a direct tax imposed on real property and is a significant source of income for the local government. The taxation system requires the owners, lessees or occupiers of the property to pay the tax that is calculated on an annual basis. The collected money is utilized for various public services like constructing libraries, repairing roads, sanitation etc. Payment of property tax on time is essential to avail tax benefits and avoid legal hassles. In Odisha, the terminology holding tax is used to depict property tax. In this article, we look at features of Odisha property tax otherwise called as holding tax and the procedure to pay the same in detail.

The Odisha Municipal Act, 1950

As per Odisha Municipal Act, 1950, the State Government of Odisha collects holding tax. However, the state government has planned to get rid of holding tax and introduce property tax all municipal bodies / urban local bodies of the state. For property tax to be introduced, the Odisha Municipal Act, 1950 and Odisha Municipal Corporation Act, 2003 have to be amended. The rules and regulations regulating the property tax are still under process. Therefore, currently, Holding Tax is being collected under the Odisha Municipal Act, 1950.

Properties Liable for Property Tax

Property tax is applicable on all types of residential buildings, commercial buildings, industrial buildings. Under the Municipal Corporation Act, the valuation committee categorizes the land and the buildings based on its usage and its structural character to levy the holding tax.

  • Residential
  • Commercial
  • Recreation and Sports
  • Industrial
  • Hospitals and nursing homes
  • Educational
  • Public purposes
  • Hotels and Restaurants

Responsibility

As per the Act, the following personnel should pay the Holding Tax.

  1. Owner or joint owners
  2. The lessor – if the land or building is let for lease
  3. The superior lessor – if the land or building is sub-let
  4. If the property is not let out, the person who has the right to let is responsible to pay the tax.

If the above-mentioned person fails to pay the tax, the occupier of the building will be charged.

Calculation of Odisha Property Tax

The holder who is in title with any holding within the corporation limits is liable to pay the Holding Tax @ of 20.5% of the annual rental value of the property depending on its nature, i.e. either residential or commercial. The method of calculating holding tax is as follows.

Annual Rental Value = Annual Rental Value per square feet X Total build up area (in square feet)

Annual Rental Value Calculation:

a)Residential

   The Annual Value of a Holding for residential purpose is calculated as per following procedures.

Step I   – Plinth area of the holding in Sq. Meter x Rs 13.65

Step II  –  Deduct 15% of the preceding value towards repair & maintenance

Step III – Add 0.5% of the land cost where the holding is located (Land cost to be determined as per G.A. Department Notification dated 01.05.1998)

Holding tax of 20.5% of the Annual Value is levied that includes Latrine Tax – 2.5% and Street Light – 5% .

b) Commercial holding

 The Annual Value of Holding of a Commercial unit is calculated as follows.

Step I   – Add Civil Cost of the building + the cost of P.H & Electric fitting

Step II  – Take 7.5% of the arrived value

Step III – Add 0.5% of the land cost with the previous value

Step IV – The Holding Tax payable per annum is 20.5% of the cost arrived at Step III.

C) Residential holding used on rent

Calculation of tax for holdings given on rent is as follows:

Step I – Monthly rent of the building x 12

Step II – Deduct 15% of the previous value towards maintenance cost

Step III- Add 0.5% of the Land Cost where the building is located

Step IV- Hence, the annual value of the building is the sum of Step I and Step III, from which the value arrived at Step II is deducted.

Note: Government buildings, government hospitals, government educational institutions, government cultural institution and other such government institutions are being exempted of paying 10% Holding Tax as per the Act.

Categories of buildings and rates of annual rental value: 

Residential BuildingsRs 2.00 per sq ft
Small ShopsRs 5.00 per sq ft
Kalyan Mandap, Gold Shop, Nursing Home, Hotel & Lodging etc.Rs 7.00 per sq ft
Bank, Insurance, Companies & Show RoomsRs 10.00 per sq ft

Failing to pay the Holding Tax as per the provision of the Act can invoke of the penalties under the Act.

Online Payment of Odisha Property Tax

The citizens of Odisha can make online payment of holding/property tax through the e-Municipality Odisha online portal.

Step 1: Visit the official website of e-Municipality Odisha

Step 2: Under “Quick Services” click on Property/Holding Tax

Odisha Holding Tax - eMunicipality
Odisha Holding Tax – eMunicipality

Step 3: Choose your District and the respective ULB from the given dropdown.

Step 4: Click on “Login”.  Enter the login credentials to access the e-Municipality application.

Odisha Holding Tax- Property tax services
Odisha Property tax – Property tax services

Step 5: Provide required details and make necessary payment.

To view demand or check payment status before payment, click on ‘View Demand/Payment Status’ under property tax services.  Fill all the details and click on “Search” button. In the screen that appears, check the assessment Details, Demand Details and Payment Details.

Step 6: After making required payment, print the receipt.

Generation of Holding Number

If no holding number has been assigned or the building has not yet been assessed for holding tax, apply for holding number using the holding number application with ROR of the land, CDA approved plan.

Step 1: Under the Property tax services, click ‘Apply online for Holding Number’.

Step 2: The application form appears. The application for the holding number includes the following details.

  • Application Details
  • Owner Details
  • Plot Details
  • Cost of construction
  • Plan Approval
  • Details of Building if Let-Out
  • Accessible to Holding Tax
Odisha Holding Tax - Generation of Holding Number
Odisha Property tax – Generation of Holding Number

Note: Accessible to holding tax, if the property is already assessed, click ‘previously assessed’ from the drop-down options. If the building has not yet been assessed, select ‘not assessed’.

Step 3: After entering all the details, click on “Submit”.

Step 4: A new application number will be generated and a SMS will be sent to the mobile number provided with the application number and to search for the status.

Check Application Status

Step 1: Under the Property/Holding Tax services, click ‘Check Application Status’.

Step 2: In the appeared screen, enter the application number/ application date or the online request number in the box and click on “Search” button.

Odisha Holding Tax- Check Application Status
Odisha Property tax – Check Application Status

Step 3: Application number along with the application status will be displayed on the screen.

Calculate Property/Holding Tax

Step 1: Under the Property/Holding Tax services, click ‘Calculate Property/Holding Tax’.

Step 2: Choose the Method (Annual Rent Value or Unit Area) and Building Type (Residential, Commercial, Industrial).

Step 3: After the above step, another box appears, asking Land Value (GA) or any other details. Fill the required details and click on “Calculate Tax”.

Odisha Holding Tax- Calculate Holding tax
Odisha Property tax – Calculate Holding tax

Step 4: The tax amount will appear on the screen.

Note: You should apply for re-assessment providing the details of construction i.e. number of floors or rooms added, their area and the purpose for which the extension is used etc.

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