ITR
Rent received in cash and not shown in AIS
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Facts
All rent you receive is taxable whether or not it appears in AIS. AIS shows only what third parties report. Leaving out rent risks a notice later.
Provisions and law
- Sec 22 (now Sec 20)Annual value of property you own is taxed under house property
- Sec 270A (now Sec 439)Penalty of 50% of tax on under-reported income and 200% for misreporting
Analysis
The AIS FAQ says you must report complete income even if AIS does not show it. Rent of ₹15,000 a month in cash is ₹1,80,000 a year, taxed after 30% and municipal tax. If it surfaces later through the tenant's HRA claim or another route, under-reported income can attract a 50% penalty under Sec 270A (now Sec 439). Issue rent receipts and keep a record.
Conclusion
- Total rent received for the year.
- Issue and keep copies of rent receipts.
- Report it in Schedule HP.
- Consider asking for bank transfers in future.
A Savvy can do this for you
Return with rent from two or more properties and home loan interest, Sec 24(b)
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