Mr A is government employee.
1 ) He received HRA of Rs 50000/-. He lives in Nashik on Rental flat
2 ) He have one house property (Flat) at Mumbai for which he has taken housing loan & some property is let out.
3) He also have one house property (Flat) at Nashik for which he has taken housing loan & some property is vacant.
Can Mr A take benefit of HRA exemption ?
Can he consider his house property ( at Nashiik Flat ) as self occupied ?
Please clarify
ITS URGENT WAITING FOR REPLY
I assume you mean to say “same property is let out” instead of “some property is let out”.
Property in Mumbai: As the property is let out and income is chargeable under the head ‘Income from house property” he would get exemption for housing loan interest.
HRA exemption: As the person is staying in rented house in Nashik, he is eligible for HRA exemption.
Property in Nashik : It can be considered as self occupied property but there is an evidence that person is getting and claiming HRA exemption. Hence, it would be considered as deemed let out property and notional income is taxable under the head income from house property.
This can be considered as self occupied if the person has genuine reason to prove that he is not able to occupy the property due to his job. In this case annual value would be taken as NIL.
Boutique Investment Bank & Transaction Advisory Firm
Gurgaon
CA
View Details
CAclubindia
