Chennai property tax made easy – Starproperties

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tax is levied by the state government and is delegated to the local bodies such as the city corporations or municipalities to specify the valuation method, the levy band and the procedure for collection. This tax has to be paid annually by the owner of the property. The tax base is calculated on the annual rental value (ARV) or on a rating based on the locality.


The Chennai Corporation uses the concept of reasonable letting value (RLV) to calculate the ARV and the half yearly property tax, under Section 100 of the Chennai City Municipal Corporation Act 1919. This is relevant to all properties in Chennai. The RLV is also known as the monthly rental value. There are different rates for commercial and residential properties.


The Chennai Corporation in 1993-94 divided the city into 172 residential locations and 274 non residential locations. So residential locations and non residential locations have different rates. The basic rate ranges from a minimum of INR 0.60 per sq ft to INR 2.40 per sq ft for residential and INR 4 per sq ft to INR 12 per sq ft for non residential locations.


While calculating property tax, the first thing to do is to arrive at the annual value of the property. This can be done by calculating the monthly rental value. This is the formula according to the Chennai Corporation website: – Plinth Area x Basic Rate per sq ft = Monthly rental value. The second step is to obtain the annual rental value. This can be obtained thus: – Monthly rental value x12 minus 10%.

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