Income Tax returns: Is rental income from property taxable in hands of homeowners? Income Tax returns: Is rental income from property taxable in hands of homeowners? Chartered Accountant CA ICAI Chartered Accountants CA ICAI CAinINDIA ICAI Announcements Accounting Standards CA News ICAI Students ICAI Members Case Laws CPT IPCC Final ICAI Course CA Course ICAI Forum CA Question Papers ICAI Study Material

« General »

Interest income from an NRO account is fully taxable in India
Income tax payers filing appeals before ITAT will have to provide information relating to the amount locked up in dispute
GST, infrastructure status drive PE investments in warehousing
Taxman should move towards limited scrutiny
Government likely to withdraw tax notice on free banking services
GST Council may bring natural gas, aviation turbine fuel under its purview at next meeting
IT department cautions TDS deductors against quarterly filing default
The notification said start-ups approved by an inter-ministerial panel are exempted from the tax which is levied on firms issuing shares to investors above their fair value, treating it as income from other sources
Why you need to sort out your tax-residency status
Government likely to withdraw tax notice on free banking services
Senior Citizens Savings Scheme Rules, 2004


« Income Tax comes a cropper tracking shell firms...	Tax department to engage with corporates to spur receipts... »
Income Tax returns: Is rental income from property taxable in hands of homeowners?

October, 09th 2017
As per the Income Tax Law the rental income would be taxable in the hands of owner of the house property. I have a let out property in joint names of me and my spouse. The loan taken in joint names and paid by me in full. All along the income/loss from HP was included in my return and assessed accordingly. Now that the loan is fully repaid by me, as part of tax planning, I intend to have the income declared by my spouse in her return as she doesn’t have any other source of income. What preparatory steps required before implementing this? – Mohit Chand From the above query we understand that the entire housing loan is repaid (no loan outstanding) and currently you are planning to reflect only the rental income in the hands of your spouse. As per the Income Tax Law the rental income would be taxable in the hands of owner of the house property. Even if sufficient proofs like spouse’s bank statements which reflects the credit for the rental income as well as the lease agreement in the name of spouse, the tax officer may still require you to substantiate the reason for not declaring the 50% of rental income in your hands since you are the co-owner of the house property. My employer has deducted an amount of Rs 20,000 from salary during the financial year 2016-17. But the Form 26AS (Tax Credit) shows the receipt as Rs 15,000 thereby there is shortfall of Rs 5,000 in transmission to income tax department. Since my income was not taxable, the employer has shown the entire amount of Rs 20,000 as refundable in the Form 16 given to me. I have made a claim of Rs 20,000 as refund in my ITR for the A-Y 2017-18. Kindly advise me? —S K Srini It could be possible that the you might not have downloaded the latest Form 26AS in which case the same might not reflect the taxes paid by the employer in the last quarter. Hence it is suggested that you could download the latest 26AS and if the entire taxes of Rs 20,000 is not reflecting, then the employer needs to revise their quarterly returns to reflect the correct taxes. Currently, since the 26AS is reflecting the credit only to the extent of Rs 15,000, there will be some challenge in getting the balance refund till the time quarterly returns are revised and the entire taxes appears in 26AS