New land lease renewal policy premium calculation formula.
(A-B) x C = D
A: current market value of land for 60 years term.
B: current market value of land based on its unexpired term.
A-B: enhanced value.
C: multiply by rate of premium (percentage) which is determined by the land usage & category. For example, residential land within the category of Town Land will be charged 25 percent.
D: amount of premium to be charged.
Example:
A: 46,400
B: 36,000
A-B: 10,400
C: 25%D= (46400-36000) x 0.25 = 2,600
No comments:
Post a Comment