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Rented flat vacant for part of the year

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If a let out property is vacant for part of the year and the actual rent received is lower than the expected rent because of that vacancy, the actual rent is taken. You do not pay tax on rent for the months it was empty. The property must have been held for letting.

Provisions

Sec 23, Income-tax Act 1961; Sec 24(a) (now Sec 22(1)(a))

Analysis

Say expected rent is ₹3,00,000 but you received ₹1,75,000 for 7 months due to vacancy. The vacancy allowance in Sec 23 lets annual value be the actual ₹1,75,000. Then deduct municipal tax, 30% and interest. Keep listing ads or broker emails to show the flat was available for rent.

Close

  1. Total the rent actually received.
  2. Show the vacancy period with evidence of trying to let.
  3. Use actual rent as annual value.
  4. Apply the usual deductions.

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Connect nowPay and start: Return with rent from two or more properties and home loan interest, Sec 24(b), ₹2,499

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