Negative NAV

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(Querist)
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21 January 2011 If the Municipal taxes paid are more than the Gross Annual Value can the net annual value be negative and set off against other heads of income in case of let out house property?

Nikhil Kothari

Nikhil Kothari (Expert)
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23 January 2011 Municipal taxes cannot exceed GAV so set off is not possible.
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Vivek Raju P

Vivek Raju P (Expert)
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23 January 2011 Muncipal taxes paid is allowed as deduction even if more than the GAV. There is no specific provision in the act that negative GAV is not allowed. It can also be taken for setoff with income from all other sources.

The act doesnot mention that perhaps as it did not forsee this situation.

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Sanjay Garg

Sanjay Garg (Expert)
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24 January 2011 Hi Vignesh,

Municipal tax is a deduction which can reduce the GAV to come up NAV upto a maximum of GAV amount. In other words, NAV can be zero but CAN'T BE NEGATIVE. Only Income from House Property can be negative due to Intt on Housing Loan.

It is 100% confirmed.

Sanjay

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