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House property

08 January 2014

Rent received from House property is taxable in a specific head "Income from House Property" even when a house property is vacant throught the year. Is this provision is also applicable for Builders who construct and sell the flats in a Building or they are taxable under head "Business and Profession"?? Please explain me with a reference of Income Tax.

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4 Replies

mahesh (student) (57 Points)
Replied 08 January 2014

yes; it is taxable u/h hp only....read sec 22

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Mahendra Makhija (Me) (43 Points)
Replied 08 January 2014

If builders are unable to sell the flats immediately or sell flats after one or more year, then they shall paid tax on estimated income arising such vacant flats. Is it correct?

neha abhishek (Auditor) (60 Points)
Replied 09 January 2014

As per sec 22 Building include residential house (whether let out or self-occupied), office building, factory building, godowns, flats, etc. as long as they are not used for business or profession by owner. And the purpose for which the building is used by the tenant is also immaterial. E.g. income from letting out godowns will be taken as income from house property. It does not make any difference at all if the property is owned by a limited company or a firm.

mahesh (student) (57 Points)
Replied 09 January 2014

if d flats remained vacant i.e. they were not let out at any time in previous year than you can take d benefit of loss owing due to vacancy i.e. nthng wud b taxable