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    BSL Ca2

    Uploaded by

    Řähûł Ř Š Śãřöj

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    © All Rights Reserved
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    BSL Ca2

    Uploaded by

    Řähûł Ř Š Śãřöj
    2 views8 pages

    Original Title

    BSL CA2 (1)

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    2 views8 pages

    BSL Ca2

    Uploaded by

    Řähûł Ř Š Śãřöj

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 8

    CA2

    Name: Abdulrahman Esam Ahmed


    Reg No: 12013170
    Roll No:RQ2018A13
    Income from House Property

    The Income Tax Act has divided the income received by an individual in various
    heads for simplification of tax computation. One of these heads is “Income from
    House property”. The income earned by the ownership of a property is said to be
    Income from House property. If a taxpayer owns a house property and rents it,
    the rent received from that property is taxable.

    Your house, building, office, or shop can be termed as house property. All the
    properties are taxable be it commercial or residential. If the property is used for
    residential purpose it is taxed under income from house property. On the other
    hand if the property is used for business or profession then it is considered as
    income from business or profession.
    Mr. Ahmed completed a house on 1-4-2020 jointly with his wife and invested
    30,00,000. House consists of two equal units. One unit is self-occupied by Mr.
    Ahmed and his family and other unit (owned by Mrs. Ahmed) is let out at 10,000
    p.m. The municipal value of the house is 2,16,000 p.a. on which municipality
    levies 10% tax and 2% of tax as surcharge. A loan of 6,00.000 was taken on 1-11-
    2017 e 9% p.a. Compute the income from house property for the assessment year
    2021-22 if: (e) Whole of capital is supplied by Mr. Ahmed and loan is also taken on
    his name. (b) 50% of capital is supplied by Mr. Ahmed and 50% by Mrs. Ahmed
    and loan is also taken jointly in same proportion and Mrs. Ahmed is herself a tax
    payee.

    Let out
    MRV 1,08,000
    Actual Rent for the year 1,20,000 1,20,000

    Which ever is higher is ARV

    Less : Municipal Taxes 10% of MRV 10,800

    Surcharge @ 2% of tax 216 11,016

    Annual value 1,08,984

    Less : Deductions u/s 24


    Standard Deduction @ 30% of AV 32,695
    For the year 2020-21 9% of 7 6,00,000 [1/2 27,000
    of 54,000]

    Interest on loan:

    1/5 of Pre-Construction Interest [I-11-2017 13,050 72,745


    to 31-3-2020 = 2 years and 5 months]
    6,00,000 x 9/100 x 2Y 5M] = 1,30,500
    1,30,500 x 1/2 x 1/5
    Income from let out house 36,239

    Self-Occupied

    Annual Value non

    Less: Deduction's u/s 24

    Interest on loan: For the year 2020-21 9% of 6,00,000 27,000


    [1/2 of 54,000]

    1 / 5th of Pre-Construction Interest [ 1-11-2017 to 31- 13,050 40,050


    3-2020 = 2 years and 5 months 6,00,000 x 9/100 x 2Y -
    5M] = 1,30,500 1,30,500 x 1/2 x 1/5
    Income from self-occupied house 40,050
    Loss under the head house property = 3,811
    Capital gain

    Capital gain is nothing but the profit that you get when you sell
    off a capital asset. When you sell a capital asset at a higher
    price than the cost at which you acquired it, you make a profit.
    This profit is called capital gain which is your income. This
    income is chargeable to tax and the tax which is calculated on
    capital gains is called the tax on capital gains or capital gain tax.
    Short term capital gain

    A house property was bought on 1st January 2009 for INR 50 lakhs. On 1st
    January 2010, INR 5 lakhs was spent in making improvements to the house. On
    1st November 2010, the house property was sold for INR 65 lakhs.

    Full value of consideration 65,00,000

    Less: cost of acquisition 50,00,000

    Less: cost of improvement 5,00,000

    Short term capital gains 10,00,000


    Since the house was sold after 22 months (about 2 years) of buying it, it would be
    categorized as a short-term capital asset. The gain from selling the house would
    be called short term capital gain
    Long term capital gain:

    Amr sold gold in fiscal year 2019-20 for Rs. 17,00,000. It was purchased in the
    fiscal year 2012-13 for Rs. 6,00,000. And Amr bought his second home for Rs.
    45,00,000 in fiscal year 2019-20.
    Amr will be able to claim deduction under section 54F :-
    Particulars Amount
    Sales Consideration 17,00,000
    Less: Index Cost of Acquisition (6,00,000*289/200) 8,67,000
    Long Term Capital Gains 8,33,500
    New House Property Purchase Price 45,00,000
    54F deductions Amount (45,00,000*8,67,000/17,00,000) = 8,33,500
    22,195,000 or 8,33,500

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