The Property Tax is governed by the The Property Tax Act, 2009 and the Valuation of Land Act Chapter 58:03, amended by Act #17 of 2009. This Act replaces the Land and Building Taxes Act and Part V of the Municipal Corporations Act #21 of 1990.
The Valuation of Land Act empowers the Commissioner of Valuations to value properties based on an Annual Rental Value.
Annual Rental Value – The annual rent which particular land is likely to attract having regard to the purpose for which the land is actually used, occupied or tenanted, or where it is not actually used, occupied or tenanted, having regard to the purpose for which it is reasonably suitable.
Valuers take several factors into account in calculating the rental value of the property. Some factors include:-
Example of Residential Annual Rental Value
|Home can rent for:||$3,000.00 per month|
|So, ‘Annual’ Rental Value||=||$36,000 ($3,000 x 12)|
The Annual Taxable Value is the annual rental value subject to the deductions and allowances which may be made by the Board of Inland Revenue. The Board may make deductions and allowances in respect of voids (periods when the property may not be rented) and loss of rent (where the landlord is unable to collect the rent) equivalent to ten per cent (10%) of the ARV.
The Annual Property Tax is calculated at three percent of the Annual Taxable Value.
Example of Residential Property Tax Calculation
|Annual Rental Value||=||$36,000|
|Annual Taxable Value (ATV)||=||$32,400 ($36,000 – 10% for voids)|
|ANNUAL PROPERTY TAX||=||$32,400 x 3% (residential rate of tax)|
|$972.00 per year|
|$81.00 per month|
|NEW SYSTEM||vs||OLD SYSTEM|
|Uniform tax rates throughout the country||EQUITY||Tax rates vary according to the location of your property|
|Payment can be made at any property District Revenue Office regardless of where the property is located||PAYMENT LOCATIONS||Payments can only be made at the District Revenue Office within the district in which the property is located.|
|Computerized Billing||BILLING||Manual method of Billing and Payments.|
|Property valuation and tax information are available online||INFORMATION AVAILABILITY||Information available to the public for a month from February 15th to March 15th.|