How are taxes for stratas calculated?
Sunday, April 15, 2012
EACH April property owners, particularly new ones, often ask the question “How is property tax to be paid on strata complexes, such as apartments?” This is a very valid question, as there is a complexity that exists in strata corporations in that all the units are covered by one valuation number.
However, according to the Registration of Strata Titles Act, owners of strata units and the corporation are jointly and severally liable for all property tax payable in respect of that parcel. Therefore, what happens is that the name of the first owner, that is the owner of lot one, will appear on the property tax database. This means that the Collector of Taxes can recover any outstanding property tax for an entire strata complex from an individual strata lot owner. It is therefore important that property owners in strata corporations ensure that other owners pay their respective amounts due.
Notwithstanding, an individual property owner can determine or calculate what portion of the total property tax for a given strata is related to them. To do this they need to first understand that:
• In the Strata Corporation all the units are covered by one valuation number.
• The title for each individual strata lot owner bears the strata lot number, the unit entitlement and the total entitlement, that is, the sum of all the individual unit entitlements.
• The unit entitlement is used to determine the quantum of individual shares in the property and calculate taxes for the individual strata lot.
Method of calculating property tax payment:
To calculate the taxes for an individual strata lot, the following formula is applied:
Example of Property Tax for Strata:
Individual unit entitlement = 12 Total unit entitlement = 150 Total obligation = $20,750.00 Calculation = 12/150 x 20,750
The owner of this lot would be required to pay $1,660.00 as their individual share of the property tax due on the total strata property.
Making payments on strata property
The payment of individual property tax for a strata corporation can be made online via the Tax Administration Jamaica (TAJ) Tax Portal at www.jamaicataxonline.gov.jm or any of the tax offices located islandwide. Whichever option will be used, the lot owner in the Strata Corporation first needs
to know the portion of the total property tax they are required to pay. This can be done by calculating the amount due using the above formula; contacting Customer Care Centre at 1-888-TAX-HELP; or getting a printout at the Customer Service desk at a tax office. In some instances, a strata corporation manager will advise the individual lot owners.
Online: Once this information is available, persons would then log on to the Tax Portal, enter their username and password to gain access to pay. Once logged into the system:
• Select the option Pay Property Tax
• Enter the Valuation Number and select the Fiscal Year
• In the box, Paid By, enter name of owner and strata lot/apt number
• Overwrite the amount which will be automatically displayed and enter the amount to be paid
• Select recalculate
• Follow the other instructions to make payment, entering credit card information.
At the end of the transaction, a statement of payment with reference number will be generated, which can be saved or printed for the individual property owner's records.
It is recommended that property owners use the online service as it gives them access to make payments on a 24-hour basis, from their homes, offices and elsewhere using a major credit card, both locally and from abroad. This means no more waiting in line.
In-line: Customers may visit any of the 29 tax offices to make their property tax payments using cash, credit or debit cards. At the tax office, persons may proceed directly to the cashier once they have a Property Tax notice or a receipt for a previous payment, which has the Valuation number of the strata property. They would, however, need to first visit the customer service desk to get a printout of the Property Tax owed, if the payment is being made without a Property Tax notice or if they are not sure how much property tax is to be paid for their individual property.
Taxpayers should insist that their lot number goes on their receipt when they make a payment on the Strata.
The Talking Tax series is prepared by the Communications Unit of Tax Administration Jamaica to guide the public on their rights and obligations. To get additional information on this or any other tax matter, persons may contact 1-888-TAX-HELP (829-4357) or www.jamaicatax.gov.jm