14 April 2009
Respected Sir, Whether Municipal Tax paid in advance can be claimed as a deduction from Gross Annual Value for a let out property? In such a case, if Municipal tax paid exceeds Gross annual value, whether entire amount paid as municipal tax can be claimed as a deduction?
15 April 2009
No. Municipal taxes paid in advance is not allowable. It is allowed to the year to which it pertains to. No. Municipal taxes paid in advance is not allowable. It is allowed to the year to which it pertains to.
15 April 2009
as per the provision muncipal tax LEVIED ( i.e. actually accrues to assessee and not paid in advance) and paid( i.e. actually paid not remaining outstanding) by owner( i.e. not by tenant or any other person) is deductible from GAV.
So , Muncipal tax paid in advance is not deductible.
If muncipal tax > GAV, then GAv will be negative and income from house property will come negative(loss). but remember in case Muncipal tax > GAV, you can not claim standard deduction u/s 24(a)
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