Depreciation on rented property

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CA Sweta

CA Sweta (Querist)
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22 February 2014 Can owner of property claim depreciation on it if it is let out??

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 February 2014 yes you can...there is no restriction on that..

AVTAR SINGH

AVTAR SINGH (Expert)
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22 February 2014 The income from rented property will be assessed under the head Income from House Property. The deduction of depreciation of that property can't be claimed by you.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 February 2014 Avtar, what if the income is being offered under the Head "Income from business/profession"??

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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22 February 2014 1. If the property used in a business, is temporarily let out, income can be offered under the head 'income from business or profession' and depreciation can be claimed.

2. In case of composite letting, income can be offered under the head 'income from other sources' and depreciation can be claimed u/s 57(ii) of the Income tax Act,1961.

3. In all other cases, I endorse the view of Avtar Ji.

AVTAR SINGH

AVTAR SINGH (Expert)
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22 February 2014 Nikhil, Annual Rental income from building has to be compulsorily assessed under 'income from House property'. There is no option with the assessee.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 February 2014 it is not compulsory Avtar. while generally yes it is true that income is to be accounted under "in from house property, there are many instances where the wider import is to be seen. where the dominant activity is to earn income from letting out commercial properties, the said income is chargeable under the head "income from business/profession"

just for eg u can read https://www.bcasonline.org/articles/artin.asp?511

AVTAR SINGH

AVTAR SINGH (Expert)
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22 February 2014 Rental income from letting out of residential and commercial buildings is covered under the head of income from House Property. It is only where, the property constitutes stock in trade of business or where business of assessee is to let out house property, income is covered under the head profits and gains of Business & Profession.

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