income tax

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GIRISH D.P (Querist)

16 July 2009 Ramesh owns a property.It is given on rent (rent being Rs10,000 p.m)to a bank.Municipal Value of the property is Rs 1,50,000.Fair rent is Rs 1,60,000 and standard rent is Rs1,50,000.Municipal tax paid by Ramesh is as follows-

Rs 26,000 on March 3,2008 and Rs 35,000 on May 10,2008.On May 1,2008 rent is increased from Rs 10,000 to Rs 15,000,with retrospective effect from 01-04-2007.Arrears of rent 2007-08 are paid in May 1,2007.what is the income chargeable to tax for the Assessment Years,2008-09
and 2009-10.

pls clarify regarding this.

Advance Thanks

GIRISH.

Abhishek Mohta

Abhishek Mohta (Expert)

17 July 2009 Assessment Year 2008-09

Annual Value of the House:

Municipal Value 150000
Fair Rent 160000
Standard Rent 150000

(I) (Municipal Value or Fair Rent whichever is higher subject to maximum of standard rent) 150000

Actual Rent 120000

Annual Value: Value in (I) or actual rent whichever is greater

Gross Annual Value 150000
Less: Municipal Taxes paid 26000
Net Annual Value 124000

Less: Deduction U/s 24
a.30% of the Annual Value 37200
b.Interest on housing loan nil
37200
Income from House Property 86800

Tax: Nil as income less than exemption limit assuming no other source of income

Assessment Year 2009-10

Annual Value of the House:

Municipal Value 150000
Fair Rent 160000
Standard Rent 150000

(I) (Municipal Value or Fair Rent whichever is higher subject to maximum of standard rent) 150000

Actual Rent 180000

Annual Value: Value in (I) or actual rent whichever is greater

Gross Annual Value 180000
Less: Municipal Taxes paid 35000
Net Annual Value 145000

Less: Deduction U/s 24
a.30% of the Annual Value 43500
b.Interest on housing Loan nil
43500
101500
Add: Arrears of Rent U/s 25B 60000
Income from House Property 161500

Tax: Rs. 1150 assuming no other source of income

Revised Return for Assessment Year 2008-09

Annual Value of the House:

Municipal Value 150000
Fair Rent 160000
Standard Rent 150000

(I) (Municipal Value or Fair Rent whichever is higher subject to maximum of standard rent) 150000

Actual Rent 180000

Annual Value: Value in (I) or actual rent whichever is greater

Gross Annual Value 180000
Less: Municipal Taxes paid 26000
Net Annual Value 154000

Less: Deduction U/s 24
a.30% of the Annual Value 46200
b.Interest on housing loan nil
46200
Income from House Property 107800

Tax: Nil as less than exemption limit assuming no other sources of income

My advise is to file a revised return as it saves tax but of course considering that last date of filing revised return has not passed.

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