One-time building tax in kerala

One-time building tax in kerala frequently asked questions (FAQ)

1.Which buildings are subject to a one-time building tax?

Under the Kerala Building Tax Act, 1975, a one-time building tax is applicable to all buildings completed on or after April 1, 1973. According to the Kerala Building Tax Plint Area Rules enacted on 10.02.1992, the tax is currently based on the floor area of the building.

2.What is a building under building tax rules?

Building means a house made of stone, brick, wood, metal or any other material. It does not include a built-in shed, a removable type of dwelling, or a toilet built adjacent to the main building. Buildings are divided into residential and non-residential (for other purposes) for the purpose of assessing the building tax.

Residential building means a building or structure constructed entirely for residential purposes and includes the outhouse and car porch attached to the building for the more convenient use of the main building but does not include hotels, lodges and boarding. All other structures that do not belong to residential buildings but fall within the definition of building fall into the category of non-residential building.

KERALA BUILGING TAX CALCULATOR animated-click-here-sign-and-button-image-0003

KERALA BUILGING TAX CALCULATOR animated-click-here-sign-and-button-image-0003

3.Which are the buildings that are not subject to tax?

1. Buildings of the Government of Central , State Government or Local Self Government Institutions, Buildings used primarily for religious, religious or educational purposes, Factories or Workshops (Section 3 (1) a).

2. Livestock, pig / poultry farms and polyhouses are exempted from building tax if used for non-sale purposes (Section 301b).

However, if these buildings are used in a non-deductible manner after tax exemption, they will be liable to pay tax with 12% annual interest from the date of completion of the building (Section 3B).

4.Will subsequent additions to the building be taxed?

If there is a change in the plinth area as a result of subsequent expansion or repair of any of the tax assessed buildings, the tax levied on the building prior to the expansion should be deducted after calculating the plinth area of the entire building. In case of subsequent addition of buildings constructed before 01.04.1973, the plinth area prior to the said date shall be excluded and tax shall be levied on the remainder.

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KERALA BUILGING TAX CALCULATOR animated-click-here-sign-and-button-image-0003

5.How to submit a return regarding the completion of the building?

The building owner who is liable to pay the building tax is required to submit a return form showing the details of the buildings in the prescribed form to the tax authority (Tahsildar). The tax assessor may also request that a notice be issued on Form No. 1 and that a return be filed within the period specified in the notice (Section 7). The owner of the building who filed the return has the right to renew the return before the tax is levied if it is found that there is any omission or forgery in the said return (Section 8). Within two months from the date of completion of the building or from the date of completion of the building or within 2 months from the date of commencement of residence, the building owner has to file a return in Form No II.

6.What happens if the return is not submitted in time?

Failure to submit the return by any person without sufficient cause or apology may result in a fine of up to Rs. 5 per day for failure (Section 22).

7.How to determine the building tax?

The building tax can be assessed on the basis of the return submitted by the building owner if the tax assessor is satisfied that it is correct (Section (1)).

If the assesse is not convinced that the return is valid, the building owner may issue a notice in Form No. 17 (section 9 (2)) to produce the necessary evidence. If the building owner accepts the evidence presented and deems it reasonable, after an inquest or inspection, the amount of the building tax to be paid by him should be determined by a written order. The tax assessment order should specify the basis of the tax assessment, the tax payable, the amount to be paid in instalments and the due date for each instalment. This order should be given to the tax payer and a copy should be sent to the concerned Village Officer.

KERALA BUILGING TAX CALCULATOR animated-click-here-sign-and-button-image-0003

KERALA BUILGING TAX CALCULATOR animated-click-here-sign-and-button-image-0003

8.What are the other important suggestions related to one time building tax?

1. As per Section 1-5 of the Kerala Finance Act, 2011, housing cess at the rate of 2% of building tax with effect from 19.07.2011 has been imposed on buildings with plinth area and residential area above 4000 sq. Ft.

2. Home stays conducted by private individuals as part of tourism promotion should be taxed by including them in "Other Buildings" (46396/501/14 / RD dated 20.10.14).

3. For residential complexes including flats for which luxury tax is paid: If the floor area of the freely occupied building is less than 228.7 sq. M.

4. In cases where Revenue Recovery measures have been taken to recover the building tax amount as per Order No. 74330 / SLMC / 03 / Revenue No. 16.12.03 dated 16.12.03 of the Government of Kerala, 6 per cent interest will be charged for the delay as per the Building Tax Act and in addition to the percentage of the tax levied under the Revenue Recovery Act. It is suggested that no.

5. PSUs like BSNL, KSHB, Kerala Water Authority and KSFDC are not exempted from building tax. (Letter No. FBA (10) 56987/04 dated 6.4.04 from the Land Revenue Commissioner)

6. Institutions with SSI registration are not exempted from building tax. (Letter No. LRB1-25341 / 02 / dated 2.27.08 from the Land Revenue Commissioner)

7. Buildings constructed on the property owned by the Local Self Government Institutions with their own funds may not be considered for taxation as they are eligible for Building Tax Exemption under Section 3 (1) A of the Kerala Building Tax Act, even if they are used for commercial purposes. (Order No. 46665 / SC2 / 2013 / Rev. dated 23.09.13 of the Revenue (Special Cell) Department).

8. Except for classrooms and libraries used for educational purposes, the tax may be levied on the administrative block and office of the hospital.

KERALA BUILGING TAX CALCULATOR animated-click-here-sign-and-button-image-0003

KERALA BUILGING TAX CALCULATOR animated-click-here-sign-and-button-image-0003

9. Property tax can be levied on buildings subject to luxury tax under section 5A of the Building Tax Act, 1975 only on production of a copy of the luxury tax payment receipt for the previous financial year. If there is a possibility of tax exemption for any building, the relevant certificate should be obtained from the concerned Tahsildar or from the officers not below the rank of Village Officer designated by the Tahsildar. (G O (MS) No. 231/2015 /LSGD dated 09.07.2015)

10.According to the Kerala Finance Act, 2013, buildings constructed on or after 01.04.2013 and having an area of more than 2000 sq. Ft. (185.87 sq. M.) If rainwater harvesting, solar panels and Source Sewage Treatment Plant are installed, 50% tax deduction on building tax will be levied.

11. According to the plan prepared by the government approved agencies including the Nirmithi Kendra, 12.5% tax relief should be given to the low cost houses built.

12. When calculating the building tax on flats / apartments, an additional 15% of the amount currently calculated for other houses should be added. (Kerala Finance Act, 1996- effective from 29.07.1996).

13. Car porch is excluded from the calculation of plinth area of residential buildings even if there is more than one car porch.(Circular no:59497/SC2/8/Revenue dtd:09.12.2008)

14. If the building is used in such a way as to nullify the exemption eligibility of any building which is exempt from building tax, the owners of such building are liable to pay the building tax including penalty of 12% penalty from the date of completion of the building.

15. The Assessing Authority has the absolute power to assess and levy tax on houses, resorts, home stays and other types of buildings constructed on illegal land subject to the provisions of the Kerala Building-Tax Act, 1975. (Circular No. SC / 1/90/2018 / Revenue dated 03.08.2018)

16. In cases where it is later found that the area of the building subject to the luxury tax is less than 278.7 sq. M. appeal / revision can be re-examined at the Tahsildar level irrespective of time limits.

17. If the roof over the top of the residential building is without a closed wall, the area does not need to be included in the plinth area. (Govt. Letter No.10418 / SC3/08/ R.D. Date. 5.3.2009.)

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