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Title: computation of income from house property
Description: persons having income more than R.S250000 is required to pay tax under the income tax act 1962. the GTI of an individual is calculated by adding the income from five heads. one of the head is income from house property. this will help in the computation of income from hp.
Description: persons having income more than R.S250000 is required to pay tax under the income tax act 1962. the GTI of an individual is calculated by adding the income from five heads. one of the head is income from house property. this will help in the computation of income from hp.
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Module 3
INCOME FROM HOUSE PROPERTY
*Chargeability (section 22), Deemed owner, income from hp exempt from tax
Computation of Income from let out property
Step1: Reasonable expected rent
***
Step2: Actual rent received or receivable ***
Step3: Highest of (1) and (3)
***
Step4: loss due to vacancy
***
Gross annual value (GAV)
***
Less: deductions u/s 23;
Municipal tax paid
***
Net annual value (NAV)
***
Less: deductions u/s 24;
Standard deduction (30% of NAV)
***
Interest on borrowed capital
***
Income from let out hp
***
Step1 : Reasonable expected rent
Firstly comparison should be made between fair rental value and
municipal value and the highest is taken
...
( Rent calculated under rent control act, it is the maximum rent a person
can legally recover from his tenant under the act)
Step2: Actual rent received or receivable
Rent of the py (or a part of the py)for which the house was available for letting
out
***
Less: unrealized rent (few conditions needs to be satisfied)
***
Rent received or receivable before deducting loss due to vacancy
***
Conditions for excluding unrealized rent from the actual rent
Tenancy should be bonafide
The defaulting tenant has vacated or has been taken to compel him to
vacate the property
...
Less: municipal tax
MT should be paid
...
MT of the py or the future years can be deducted if it is paid by the real
owner
...
Less: interest on borrowed capital
1
...
Interest on fresh loan taken to pay the original loan is deducible
...
Pre construction period interest
Amt * rate * no
...
of months =from the date of borrowing to the 31 st march immediately
preceding the year of construction
...
Property used throughout the py for own residential purposes
The gross annual value of one self occupied property is nil
...
Deduction can be availed up to RS
...
Other wise deduction up to RS
...
Conditions to be satisfied to get the exemption of RS
...
Acquisition or construction is to be completed within 3 years
from the end of the fy in which the capital is borrowed
...
Gross Annual Value
Nil
Less : MT
NA
Net Annual Value
Nil
Less: std
...
200000/30000
Loss from self occupied hp
(200000/30000)
2
...
3
...
When part of HP is occupied and other part is let out
...
* Annual value is calculated by taking municipal value, fair rental value,
municipal tax, interest on loan…
...
Recovery of arrears of rent
It is taxable u/h income from HP if it is not taxed earlier
...
http://ziyakaraoke
...
in/p/new-arrivals
Title: computation of income from house property
Description: persons having income more than R.S250000 is required to pay tax under the income tax act 1962. the GTI of an individual is calculated by adding the income from five heads. one of the head is income from house property. this will help in the computation of income from hp.
Description: persons having income more than R.S250000 is required to pay tax under the income tax act 1962. the GTI of an individual is calculated by adding the income from five heads. one of the head is income from house property. this will help in the computation of income from hp.