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    Income From House Property

    Uploaded by

    Abhishek Narayanan
    The document outlines the steps to compute income from house property under the Indian Income Tax Act. It details calculating the gross annual value, deducting municipal taxes and standard deductions, and subtracting interest payments like home loans to determine the net income or loss from each of the taxpayer's four properties. The properties are categorized as self-occupied, let-out, or deemed let-out, and the final values represent the taxable income from house property.

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    Income From House Property

    Uploaded by

    Abhishek Narayanan
    218 views2 pages
    The document outlines the steps to compute income from house property under the Indian Income Tax Act. It details calculating the gross annual value, deducting municipal taxes and standard deductions, and subtracting interest payments like home loans to determine the net income or loss from each of the taxpayer's four properties. The properties are categorized as self-occupied, let-out, or deemed let-out, and the final values represent the taxable income from house property.

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    Income from house property

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    The document outlines the steps to compute income from house property under the Indian Income Tax Act. It details calculating the gross annual value, deducting municipal taxes and standard deductions, and subtracting interest payments like home loans to determine the net income or loss from each of the taxpayer's four properties. The properties are categorized as self-occupied, let-out, or deemed let-out, and the final values represent the taxable income from house property.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    218 views2 pages

    Income From House Property

    Uploaded by

    Abhishek Narayanan
    The document outlines the steps to compute income from house property under the Indian Income Tax Act. It details calculating the gross annual value, deducting municipal taxes and standard deductions, and subtracting interest payments like home loans to determine the net income or loss from each of the taxpayer's four properties. The properties are categorized as self-occupied, let-out, or deemed let-out, and the final values represent the taxable income from house property.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    INCOME FROM HOUSE PROPERTY

    Particulars House1 (Rs) House2 House3 House4 (Rs)


    (Rs) (Rs)

    Type of House Property Self- Self- Let-Out Deemed Let


    Occupied Occupied Out

    Gross Annual Value – – xxx xxx

    Less: Municipal Tax – – xxx xxx

    Net Annual Value – – xxx xxx

    Less Standard Deduction @ – – xxx xxx


    30% of NAV

    Less: Interest on Home xxx – xxx xxx


    Loan

    Less: Pre-Construction xxx


    Interest

    Income/ (Loss) From House xxx Nil xxx xxx


    Property

     Steps to compute Income from House Property


    a. Determining Gross Annual Value (GAV) of the property:
    The gross annual value of a self-occupied property is nil, while for a let out property the gross
    annual value is the rent collected for the same house property.

    b. Reduction of Municipal Taxes (property tax):

    When the property tax is paid it is allowed to be deducted from the gross annual value of the
    property.

    c. Determination of Net Annual Value (NAV):

    When the property tax is deducted from the Gross Annual Value it gives the Net Annual
    Value.

    d. Reduction of standard Deduction @30% of Net Annual Value:

    30% of the Net Annual Value is allowed to be deducted as a rebate from the NAV under
    Income Tax Act. Beyond 30% no other expenses such as repair, reconstruction or painting
    can be claimed as a tax relief under the Act.

    e. Reduction of home loan interest:

    The interest paid during the financial year on the house loan availed is to be deducted under
    section 24 of the Income Tax Act.

    f. Final Determination of Income from House property:

    The final value that arrives is your income from house property. This is taxable at the slab
    rate applicable on your income.

    g. Loss from house property:

    If an individual owns a self-occupied property purchased on loan, claiming a deduction on


    home loan interest will result in loss as the Gross Annual Value of the house property will be
    nil. This loss can be adjusted in income from other heads.

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