Quick Summary
Reporting of income from letting out of house property under 'Income from House Property' Section 28 of the Act specifies kinds of income that shall be chargeable to income-tax under the head 'Profits and gains of business or profession'. 2. It has been observed that some taxpayers are reporting t
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FAQ :
The new rules will take effect from the 1st day of April, 2025.
The clarification ensures that income from letting out a residential house or part of it must be reported under the 'Income from house property' head, not under 'Profits and gains of business or profession'.
The change is being made because some taxpayers were incorrectly reporting rental income under the 'Profits and gains of business or profession' head, which allowed them to substantially reduce their tax liability.
These rules will apply to assessment year 2025-26 and subsequent assessment years.
The clarification specifically addresses income from letting out of a residential house or a part of the house by the owner.
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