INCOME TAX SECOND HEAD OF INCOME INCOME FROM

INCOME FROM HOUSE PROPERTY �CHARGEABILITY �WHEN –SECTION 22 THE INCOME TAXABLE UNDER THE HEAD

SECTION -22 a) The assessee should be the owner of the house property. a)

Let out property - Format Gross Annual Value Less: Municipal Taxes Net Annual Value

Determination of GAV Municipal Valuation – value fixed by municipal authorities. Fair Rent –

If S. R is not given – GAV is higher of the following: a)

If S. R is not given – 3 steps to be followed Step –I

Unrealised Rent A default made by the tenant in the payment of rent is

Municipal taxes Conditions: 1. Paid by the owner of the house property 2. Paid

Deduction U/s 24 a) Standard Deduction : Compulsory deduction allowed @ 30% of Net

Pre Construction period �Interest paid upto the date of completion of construction or upto

Date of repayment of loan If Do. Ro. L is earlier – then the

Slides: 12

Download presentation

INCOME TAX �SECOND HEAD OF INCOME

INCOME FROM HOUSE PROPERTY �CHARGEABILITY �WHEN –SECTION 22 THE INCOME TAXABLE UNDER THE HEAD INCOME FROM HOUSE PROPERTY

SECTION -22 a) The assessee should be the owner of the house property. a) There should be a building or land connected with the building. a) The building should not be occupied by the assesee for his own business.

Let out property - Format Gross Annual Value Less: Municipal Taxes Net Annual Value Less: Deduction U/s 24 a) Standard Deduction (30 % of NAV) b) Interest on borrowed capital IFHP XXX XXX XXX

Determination of GAV Municipal Valuation – value fixed by municipal authorities. Fair Rent – rent of a similar property in the same locality Rent Receivable – rent charged by the owner Standard Rent – rent fixed under the Rent Control Act.

If S. R is not given – GAV is higher of the following: a) Municipal Valuation b) Fair Rent c) Rent Receivable Note: Rent Receivable means Annual rent – unrealised rent

If S. R is not given – 3 steps to be followed Step –I – Max of a) M. V or b) F. R or c) R. R Step – II – Max of a) R. R or Standard Rent Step – III – GAV is the least of the two maximums calculated above

Unrealised Rent A default made by the tenant in the payment of rent is unrealised Rent. CONDITIONS: a) The tenancy is bonafide (genuine and real) b) Reasonable steps should have been taken by the assessee to make the tenant to vacate the property. c) The defaulting tenant should not occupy any other house of the assessee.

Municipal taxes Conditions: 1. Paid by the owner of the house property 2. Paid during the previous year 3. M. T including water tax and sewage tax

Deduction U/s 24 a) Standard Deduction : Compulsory deduction allowed @ 30% of Net Annual Value. b) Interest on borrower capital: i) ii) Preconstruction period and post construction period

Pre Construction period �Interest paid upto the date of completion of construction or upto the date of repayment of loan (whichever is earlier). �Such interest will be allowed in 5 equal instalments. �If Co. C is earlier – then preconstruction period is restricted to 31 st March of the preceding year.

Date of repayment of loan If Do. Ro. L is earlier – then the period is upto the date of repayment.