By Krishna Dua 
Property Tax Update: New Rates, Deadlines and Rules
The Municipal Corporation of Delhi (MCD), along with several other major urban local bodies across India, has rolled out significant revisions to property tax assessment and collection rules effective from the financial year 2026–27. These changes—announced in phases between November 2025 and January 2026—aim to increase municipal revenue, improve compliance through digital processes, reward sustainable buildings, and address long-standing complaints about outdated valuations. In Delhi alone the MCD projects an additional annual revenue of ₹1,900–2,300 crore once the new system stabilises. Similar upward revisions have been notified in Mumbai (BMC), Bengaluru (BBMP), Hyderabad (GHMC), Chennai (GCC), Pune (PMC), Ahmedabad (AMC) and Lucknow (LMC), with most cities moving toward either a refined unit-area-value system or a capital-value-based model.
This article explains the major changes in rates, deadlines, rebates, exemptions, penalties, online payment processes and the likely impact on homeowners, tenants, investors and developers in 2026.
Delhi – MCD Property Tax Regime 2026–27
The MCD has transitioned to a hybrid Unit Area System (UAS) + mandatory self-assessment model. The most important changes are:
- Base Unit Area Values (UAV) revised upward by 15–45% depending on colony category (A to H).
- Highest increase: A & B categories (South Delhi, Lutyens’ Delhi) – average 38–45%
- Moderate increase: C & D categories (Rohini, Dwarka, Mayur Vihar) – 22–32%
- Lowest increase: F, G, H categories (unauthorised colonies, urban villages) – 15–20%
- Age-based rebate enhanced:
- Buildings >25 years old: 25% rebate (earlier 20%)
- Buildings >40 years old: 40% rebate (earlier 30%)
- Vacancy rebate reduced from 10% to 5% and made conditional on vacancy ≥6 months in a financial year (self-declaration + physical verification).
- New occupancy factor:
- Self-occupied residential: 1.0
- Rented residential: 1.2
- Commercial (offices/shops): 1.5
- Commercial (hotels, malls, banks): 2.0
- Green building incentive increased: 15% rebate for GRIHA 4-star or IGBC Gold certified properties (earlier 10%).
- Mandatory online self-assessment for all properties >100 sq m from FY 2026–27. Smaller properties can opt for old system till 31 March 2027.
Residential self-occupied tax rates (per sq m per annum – illustrative)
- A-category (Vasant Vihar, Jor Bagh, Golf Links): ₹19–₹23
- B-category (Greater Kailash, Defence Colony): ₹15–₹18
- C-category (Rohini, Pitampura, Mayur Vihar): ₹10–₹13
- D & E-category (Dwarka, Paschim Vihar): ₹7–₹10
- F–H categories: ₹3–₹6
Payment deadlines & rebates
- First instalment (50% of annual tax): 30 June 2026 – no rebate
- Second instalment: 30 September 2026 – 5% rebate if entire year paid by 30 June
- Full advance payment by 30 April 2026: 8% rebate
- Last date without penalty: 31 March 2027
- Penalty: 1% per month simple interest (max 12% p.a.)
Mumbai – BMC Property Tax 2026–27
BMC has retained the capital-value (CV) system but made annual CV revision compulsory from FY 2026–27 (earlier discretionary). Average CV increase is 24% city-wide, with sharp jumps in South Mumbai (35–50%) and moderate rises in suburbs (12–22%).
Key changes:
- Ready reckoner rates (used for CV calculation) revised upward by 22–48% across zones.
- 12% additional tax on vacant land/non-residential properties unused for >12 months.
- 18% rebate for properties with solar rooftop ≥3 kW + rainwater harvesting.
- Mandatory online payment for properties with annual tax >₹60,000.
Deadlines
- 8% rebate: 30 April 2026
- 4% rebate: 30 June 2026
- Without rebate: 30 September 2026
- Penalty: 2% per month after 31 March 2027
Bengaluru – BBMP Property Tax Changes
BBMP has increased guidance-value-linked tax by an average 22% and introduced a 10% automatic annual escalation clause for the next 5 years (capped at 50% cumulative). Premium zones (Indiranagar, Koramangala, Sadashivanagar) see 30–40% jump; peripheral areas (Yelahanka, Devanahalli) see 12–18%.
New rules:
- 20% rebate for solar PV ≥3 kW + rainwater harvesting.
- 5% additional rebate for women owners (single/joint).
- Mandatory linkage of Khata certificate with Aadhaar for new assessments.
Deadlines
- 5% rebate: 30 April 2026
- Without rebate: 30 June 2026
- Penalty: 2% per month after due date.
Other Major Cities – Snapshot of Changes
- Hyderabad (GHMC): 16% average increase; 100% exemption for self-occupied properties up to 150 sq yd in old city areas.
- Chennai (GCC): Unit-area-value revision after 9 years; 20–35% increase in zones 1–8; 12% rebate for senior citizens.
- Pune (PMC): Capital-value revision; 14–32% hike; 18% rebate for rooftop solar ≥2 kW.
- Ahmedabad (AMC): 18% average increase; 15% rebate for GRIHA-certified buildings.
Impact on Different Segments
- Self-occupied homeowners — Middle-class families in premium colonies face 20–45% tax increase (₹10,000–₹35,000 additional annual liability in Delhi/Mumbai). Many are transferring property to wife/mother to avail women/senior-citizen rebates.
- Landlords — Rental yield compression worsens by 0.4–0.8% in metros. Rent hikes of 8–15% expected in commercial and high-end residential segments.
- Investors — Capital values may soften 4–7% in over-supplied micro-markets if tenants resist rent increases. REITs and fractional-ownership platforms see short-term pressure.
- Builders — Higher holding cost for unsold inventory; pre-launch projects in newly assessed zones face 15–25% higher upfront liability.
- City finances — MCD expects ₹2,000 crore additional annual revenue; BMC targets ₹2,800 crore; BBMP aims for ₹1,300 crore extra. Funds earmarked for roads, water supply, waste management and lake rejuvenation.
How to Check and Pay Property Tax Online (2026 Process)
Most ULBs now have unified portals:
- Delhi → mcdonline.nic.in
- Mumbai → portal.mcgm.gov.in
- Bengaluru → bbmp.gov.in → SAS module
- Hyderabad → ghmc.gov.in
- Chennai → chennaicorporation.gov.in
Common steps:
- Search by property ID / door number / Aadhaar-linked Khata.
- View old vs new assessment and tax liability.
- Choose instalment or full payment.
- Pay via UPI, net banking, debit/credit card or Bharat BillPay.
- Download e-receipt and avail rebate if paid early.
Final Takeaway
The 2026 property tax revisions mark the beginning of a new normal for urban property owners in India. Frozen or low valuations are largely over; municipalities are now serious about revenue buoyancy to fund infrastructure and services. Homeowners should check their new liability immediately, pay early to secure rebates, and explore legitimate concessions (senior citizens, women ownership, green buildings).
For prospective buyers and investors, property tax is no longer a negligible line item—especially in premium and newly developed zones. The era of low municipal levies is ending; the era of accountable, better-serviced cities is (hopefully) beginning.