Friday, August 01, 2014
Frequently Asked Questions About Property TaxSunday, March 24, 2013
With the recent announcement of an increase in property tax for the 2013-2014 period, which becomes due on April 1, as well as continued discussions on property tax arrears for previous years, there has been a lot of questions about property tax. The following are a few of the basic frequently asked questions about property tax.
What is property tax?
Property Tax or land tax is a charge levied on all property in Jamaica. It is charged on the unimproved value of land.
How is land valued?
In Jamaica, land valuation for the purpose of property tax is based on the unimproved value of the land, that is, the price which the owner would expect to receive if he were selling the land alone disregarding the value of any improvements such as buildings and crops. Several factors determine the (unimproved) value of land, including:
o Size of the parcel of land
o Zoning and type of land
o Potential for development
o Topography (elevation & other surface features)
o Soil classification
o Access to municipal & commercial services, and
o Neighbourhood characteristics
Valuation of property is carried out by the National Land Agency and was last done in 2002.
Are any properties exempt from property tax?
Not all properties are subject to property tax. The following categories of land are exempt from the payment of Property Tax:
o Buildings exclusively used for religious worship, church yards, burial grounds and rectories,
o Educational institutions and properties owned by the Council of Legal Education,
o Government-owned lands,
o Lands owned by the Local Authorities,
o Hospitals, and
o Lands owned by charitable or cultural organisations approved by the Minister and used solely for the purposes of such organisations.
What does Property Tax pay for?
Property taxes are used to finance property-related services in communities throughout Jamaica. Property Tax pays for:
o Maintenance and expansion of street lighting,
o Collection and disposal of solid waste,
o Community infrastructure and civil improvements,
o Repairs to fire stations, and Rehabilitation of parochial/farm roads,
o Administration of Local Authorities.
Who pays property tax?
The Property Tax Act states that all persons in possession of land can be asked to pay. Such a person is defined by the Act as the owner, occupier, mortgagee in possession or other person in actual possession of such property. This means that if you are renting a house or leasing private lands for farming, you should make sure that the owner pays the property tax as you could be asked to pay the outstanding property tax, if the rightful owner cannot be located.
How is property tax calculated?
Property tax rates are scheduled for increase effective April 1, 2013. This means that for the 2013 - 2014 period, which becomes due on April 1, all properties with an unimproved value of up to J$100,000.00 will be charged a flat rate of J$1,000.00. Properties with values exceeding J$100,000.00 up to J$1,000,000.00 will attract an additional 1.5% for every additional dollar above J$100,000.00. Properties with values exceeding J$1,000,000.00 will attract an additional 2.0% for every additional dollar. Therefore on a property for which the unimproved value is J$400,000.00 the tax due and payable on April 1 is J$5,500.00
Where is property tax to be paid?
Tax Administration Jamaica (TAJ) is responsible for collecting property tax on behalf of the Government. The most convenient way to pay is online via the Jamaica Tax Portal at www.jamaicatax-online.gov.jm, using a credit card. This can be done from the comfort of your home, office or even from overseas. The payment can also be made in-line at any of the twenty-nine (29) tax offices across the island. Alternately, the TAJ usually advertises "out-station" collection points during the period April to June each year, to accommodate the payment of property tax and trade licences in several communities.
Can action be taken for property tax arrears?
Under the Tax Collection Act the tax collector has several options to recover outstanding property taxes, including court action. These will be highlighted in another Talking Tax article. In the meantime persons with outstanding property taxes are encouraged to settle their arrears or face sanctions. If difficulties are being experienced to settle the entire property tax bill, then person should visit their local tax office and speak with a Compliance Officer to make an arrangement to pay.
Where can you get additional information?
For more information and details of the schedule for outstations operations, persons may contact the Tax Administration Customer Care Centre at 1-888-TAX-HELP (1-888-829-4357) - local; 1888-GO-JATAX (1-888-465-2829) - USA or visit www.jamaicatax.gov.jm or email firstname.lastname@example.org
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