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Whether rent includes maintenace or not

Tax queries 1954 views 5 replies

Hi,

My client is getting rental income of 20,000 per month which includes 3000/- maintenance charges. I am confused whether I should take 20,000 as rental income and give 30% standard deduction for maintenace charges or take 17000/- rental income.Please guide.

 

Thanks in advance

Replies (5)

Even if you consider 17000 as rent you are further allowed 30% so this 3000 get unaccountable. Its better to use 20K as rent figure

Deat Shalini, Rent includes maintenance charges if maintenance agreement can't stand alone. For better understanding you may refer rulling J.K. Investors (Bombay High Court)

Full 20,000 is the rent for the purpose of computation, rent here is basically whatever you have received in consideration of letting out the property.This 3000 is also part of the consideration for letting out the property and hence it is includible. Even if there is non monetary benefits then its fair value should also be considered.

From the time since 30% standard deduction has been provided for, maintenance or repairs are not considered.

 

In case property which has been let out require certain monthly or periodical payment to Society or RWA and this 3000 represent that sum then take rent as 17000 else treat entire 20000 as rent and claim 30% as deduction meant for said maintenance only.

Dear Rajesh,

Yes, this 3000/- is monthly payment to society for maintenace . Personally I don't think that  I can take 17000/- as rent and claim 30 % again for maintenance (suggested by others also).

Thanks


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