Unrealised Rent - Query

Tax queries 1600 views 14 replies

 Suppose X an individual receives unrealised rent relating to AY 2005-06 and it is taxable in AY 2008-09 . whether statutory deduction u/s. 24 (a) i.e 30% of such amount is allowable or not because in book it is given that no deduction is allowable against such receipt.????? 

Replies (14)

No. Section 25AA. 30% deduction is not allowed for unrealised rent, now received for which u excluded from GAV earlier.

 

However, for arrears of rent, the 30% deduction can be claimed U/s 25B.

You will get flat 30% deduction only in case of Arrears of rent.(See section 25B)For unrealised rent there is no 30% deduction.

Yes 30% deduction is available only for arrears of rent and not for unrealisedrent recd.

30% Standard Deduction is available only for Arrears of Rent. But Unrealised Rent is taxable fully without 30% deduction .

Originally posted by :RSDNT bt nt ordnrly RSDNT EVIL
" No. Section 25AA. 30% deduction is not allowed for unrealised rent, now received for which u excluded from GAV earlier.
 
However, for arrears of rent, the 30% deduction can be claimed U/s 25B.
"

Agree.....

 agree with deepika and subra

what is the difference between unrealised rent and arrears of rent????

ya.....agree with deepika and subra

Arrears means  - a debt that remains unpaid. and

Unrealised rent means. - failure to realize rent.

 

Rent which is unrealised is arrears na?? So arrears = unrealised rent right?

The logic behind this section is that 30% standard deduction is given only for arrears of rent as the standard deduction is available u/s 24(a) with respect to repairs. Unrealised rent is one where the tenant has vacated the property or steps have been taken to vacate the premises. Hence the need for repairs doesnt arise and no deduction available for unrealised rent.

Unrealised rent means the rent which has been deducted from actual rent in any previous year for determining annual value while Arrears of rent implies rent not charged to income tax in any previous year. No deduction is allowed in respect of Unrealised rent(Sec 25AA) while 30% of amount of Arrears of rent(Sec 25B) shall be allowed as deduction.

hi friend

in my views if it has been charged as income then only its fully taxable otherwise it should got exemption

Unrealised Rent- If any amount of rent is not capable of being realised, then such portion of rent shall not be included in computing the sctual rent received or receivable.

Arrears of Rent Received- The assessee may have sought enhancement of rent from the tenant and the same could be in dispute. Subsequently as and when the additional rent is realised the same is liable to tax as arrears of rent received.

In both the above cases, even if the assessee is not the owner of the house property, it is chargeable under the head Income from House Property.


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