Income from house property

Others 713 views 19 replies

An assessee lives in his house only six month and after that he goes out owing to changing the place of service. Then he let out his house for the remaining 6 month.

Municiple Valuation of the House is 150000

Fair Rent of the house is 175000

Standered Rent of the house is 180000

Actual Rent received 90000 for six month 15000*6 month

I am confused in this situation that Municipal Valuation, Fair Rent and Standered Rent will also be taken for 6 month like that  MV is 75000 and FR 87500 & SR 90000.

 

Please help me anyone its urgent.

Replies (19)

I think actual rent is applicable as its just oe house, if it was second house then your confusion was genuine.

1) First Compute gross annual value as per Sec. 23(1)(a) 

     a)  It will be Higher of  MV or FR  (standard rent is not applicable I think)  =   175000

     b)  Rent actually paid  =      90000

Since the property is let out and was vacant for part of the year and the actual rent received is less than the value determined u/s 23(1)(a), Sec. 23(1)(c) would be applicable.
Therefore, the gross annual value shall be the actual rent received or receivable

Hence  GAV is    lower of two   90000

2)   GAV  =90000  less Municipal taxes paid say X   so  Net annual value is

         90000 - X

3) deduct 30% statuary deduction    i.e deduct 0.3 x ( 90000- X)  

4) Deduct int on Borrwed capital  - say Y

5)  Income from House property will be   0.7 x ( 90000 - X)  - Y

i hope i am correct on this. 

Other experts also plz put ur inputs

           

But confusion is that house is vacant owing to not residing of owner in the house. not owing to tanent. what will be made in this case.

House is occupied by owner for 6 months and 6 months tenant is there. 

In return you have to rented out.

You have to compute the GAV assuming that the house is rented for the whole year but consider only the actual rent received/recievable

i am also satisfied with Mr. khemraj...

Yaaa Sarika Goswami Mr. Khemraj may be right. Did you read this topic Sarika ??????

yaa, i have read this topic very well..

90000 is frv for tax purposes if well documented and not understated. Treat it as Gross rent deduct allowable deductions. This is net income +/- will form part of GTI.

calculate the income as let out for whole year but calculation should be as given below.

1. first of all MV OR FR( for 12 month) whichever is higher  150000 or 175000 = 175000

2. after that Std. rent or option 1 value whichever is lower.   180000 or 175000 = 175000

3. then actual rent calculate on 12 month basis or option 2 value WIH. 90000*12/6 or 175000=180000

4. if in option 3 actual rent is selected then only actual rent received for 6 month as gross annual value .    180000/6= 90000

Copy DRB, This is the best way.

Since the property has been let out, so benefit of self occupation will be lost & accordingly GAV will be computed as per sec-23(1). So ur GAV will be Rs. 1.75 lakhs, i.e., for the whole year. Hope ur doubt is cleared now.
Show all for 6 months and den compute
Take figure of all for 6 months and den calculate


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register