When to claim deduction of reimbursem tax paid by tenant and

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 March 2013 for the f.y.2012-13 tenant has paid the municipal tax to municipal. Owner of the Licensor will reimburse the expenses of property tax to the tenant in the next finanncial year i.e.f.y.2013-14.

under such, when can landlord will claim deduction of the reimbursement of the property tax paid by the tenant in f.y.2012-13 ?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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10 March 2013 well, I will advise you to claim in FY 2012-13 itself.

The language of the act suggest actual payment of taxes. So, claim in FY 2012-13 and keep the reimbursements out of books.

Santosh Mishra

Santosh Mishra (Expert)
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10 March 2013 Yes, it need be claimed in FY 2012-2013 itself.

Municipal tax has been actually paid during the year by tenant on behalf of the owner.

Querist : Anonymous

Querist : Anonymous (Querist)

27 April 2013 is reimbursement in cash paid to tenant by landlord is allowable expenses to claiming the property tax paid under the house property head?

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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03 August 2025 Good question!

Here’s how it works for municipal tax paid by the tenant on behalf of the landlord:

Deduction for municipal tax under the Income Tax Act is allowed to the owner in the year in which the tax is actually paid — that means the year the tenant paid it to the municipality (FY 2012-13 in your case).

The reimbursement paid by landlord to tenant is treated as just repayment of an expense already paid by the tenant on behalf of the landlord. So this reimbursement itself is not an additional deduction; it’s just passing back the money.

Therefore, the landlord should claim the municipal tax deduction in FY 2012-13, when the tax was actually paid by tenant (on landlord’s behalf), and not in the year reimbursement is made (FY 2013-14).

The reimbursement paid in FY 2013-14 is not an expense under house property, as it relates to the municipal tax already paid and claimed in the earlier year.

Summary:
Claim municipal tax deduction in FY 2012-13 (year of payment to municipality), and treat reimbursement to tenant as repayment — no extra deduction in FY 2013-14.

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