Rent income

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 October 2014 sir, my client have a factory premises, due to bad market condition his business is not running properly. It is a pvt. ltd. compnay they are planning to let it out on rent basis factory premises to others. my queries is this when they receive rent can they treat rent as a business income and from that can they claim expenses like salary to office staff, office expenses etc. or not. can they pay director remuneration from that income. kindly advise me please.

NOTED SIR
BUT MY QUERIES STILL PENDING CAN I CLAIM EXPENSES AGAINST BUSINESS INCOME IF I TREAT, MY PAST YEARS LOSS CAN I TAKE SET-OFF IN CURRENT YEAR INCOME (WHICH IS COMES FROM RENT INCOME) OR NOT PLEASE ADVISE

Nikhil Kaushik

Nikhil Kaushik (Expert)
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20 October 2014 most probably it would considered as income from house property.

however, the business loss that would be there on account of business expenses can be set off against this house property income.

CA.Vinita Gupta

CA.Vinita Gupta (Expert)
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20 October 2014 It has to be considered under Income from House Property

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 October 2014 Where a factory building is let out, the rent received generally is income from business in the hands of the lessor or the owner of the factory. Depreciation, salary office expenses and Directors remuneration can be claimed.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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20 October 2014 seetharaman - any case law to back it up?

@VaibhavJ

@VaibhavJ (Expert)
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20 October 2014 Hi

Both the rental incomes i.e.Residential / Commercial will treated under the head Income from House Property

You can claim 30% as Repairs & Maintenance u/s.24 A of IT Act. on the net rental amount received after deducting Water & Property Tax payments.

You may claim depreciation as per IT Act.

If property taken on loacn then you can also claim interest on loan taken u/s24B.

Losses from business/profession can be set off against all income heads other than salary.

Thanks

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 October 2014 Please refer the following links.

https://www.incometaxindia.gov.in/Tutorials/TDS-Rent-194I-194C.pdf
https://indiankanoon.org/doc/1698049/

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