Problem in House property

What will be tax treatment if actual rent of house property is lower than estimated rent partly because of Vacancy and partly because of other reasons like (low rent) ???

let say:- estimated rent Rs120000, actual rent P.M 7000 Vacancy period is 2 month.

Replies (5)

U have to determine the gross annual value . It should be noted that estimated rent cannot exceed standard rent ( if standard rent is notified for that property ) Municipal Valuation of ratable value can be taken as one of the tests to determine bonafide value of the property

Since the head itself can bring notional income to tax , the above values or rent received whichever is higher is to be considered .

Vacany allowance is to be deducted from that value .

In your case the answer would be 100000 ( 10000 pm* 10 months )

 in this case if your actual rent is less than estimated rent due to vacancy than actual rent will be consider as G.A.V. i.e. 7000*10=70000

Low rent and vacancy cannot be treated on the same plane.

Otherwise, no one will have taxable income from House property.

there seems to be some mistake in my calculation .i realise that vacancy allowance should be on actual rent , There fore the answer should be 120000(10000*12)-14000(7000*2)=106000

How to calculate GAV if the house is self occupied for some part (say 5 months) and for remaining let out (i.e. 7 months) and annual rent (rent receivable) if the house would let out for whole the year let out be Rs. 12000?

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