One of My clients having Rental income from Commercial Property. Rental income accruing every year from 2001 onwards but suddenly in 2008 building got damaged. So he unable to get rent from property . shall i file income tax return as NIL return or showing as notional rental income in return.
09 September 2011
Income is taxable on due or accrual basis but in the instant case it seems the very purpose of cause to generate the rental income became non-existant due to the damage of property-will not arise the income whether due or to accure unless something contrarty is documented/agreemented to this effect. Income from this source will as such be NIL, but need to keep the same documented to substantiate the same lator on in a case demand/notice so arise.
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