Income From House Property
Any Income generated by the way of Rent from Residential House, Land, Commercial Land or Building is Taxed under the head Income from House Property. There is no Difference between commercial property or residential properties under the head Income from house Property for taxation purposes.
Any Individual or HUF earning more than Rs 20 Lakhs in a Financial Year by the way of Rent is Liable to Pay GST on the Rental Income Received by them. In such cases the GST is collected from the Tenant of the Property.
Let Out Property
Income received as rent in a Financial Year is considered as Rental Income. If the Property is vacant with out any rental Income even in such a case it is considered as deemed to be let out. For taxation purposes the property is still considered as let out and the Taxes are to be paid in such cases.
Self Occupied Property
For Taxation purposes an Individual can only consider only one property as Self Occupied. Self Occupied Property more than one is considered as Let out Property. A Self Occupied Property can be Occupied by the Parents, Kids or Spouse of the taxpayer.
Calculation of Income Under the Head Income from House Property
Gross Rental Income: This is Rent received in a Financial Year.
Net Annual Income: Rent Received – Property Tax
Standard Deductions: 30% of the Net Annual Value is deducted towards any repair and maintenance of the property.
Interest on Home Loan: Interest paid on the home loan is allowed for deduction under Income from house property.
Income Under House Property = Net Annual Income – Standard Deductions – Interest on Home Loan.
A Loss Under Income from House Property is arrived in two cases.
Incase of a Self Occupied Property and the Interest paid on the home loan is considered as Loss.
Incase of a rental Property if the rent received is less than the Interest paid on the home loan then a Loss arises.
Under the Head Income from House Property a maximum of Rs 2,00,000 only can be considered as loss irrespective of the loss Incurred paying the Home loan Interest. This Loss is setoff against any other Income Received.
Under Section 80 C there is a deduction on Principal Repayment of Home Loan Upto Rs 1,50,000 in a Financial Year.
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