A Detailed Discussion on Taxability under the Head “Income from

House Property”
taxguru.in/income-tax/detailed-discussion-taxability-head-income-house-property.html

DEEPAKJ

CA Deepak Jauhari

To determine the tax liability of a person under income tax, first of all his Gross
Total Income (GTI) is to be computed as under consisting of income from the five
heads of income:

(1) Income from Salary

(2) Income from House Property

(3) Income from Business and Profession

(4) Income from Capital Gain

(5) Income from Other Sources

What is income under the head “Income From House Property ”?

Income from House Property covers the rent earned from the House property which is
chargeable to tax. Sometimes, the owner may have to pay tax on ‘deemed rent’ in case the
property is not let out or vacant. The income from house property would be taxable if it
satisfies the following three essential conditions:

The assessee is the owner of that property

The property must consist of house, buildings and/or land.
The property may be used for any purpose except used by the owner for the purpose
of running his business or profession.

Who is owner

It is legal owner who is chargeable to tax in respect of property income. Transfer of house
property by the individual without adequate consideration to his or her spouse or to his
minor child is considered as “deemed owner”of the house property.

Steps involved in the Computation of Income from House Property

(1) Computation of Gross Annual Value

(2) Computation of Net annual Value

(3) Computation of Deduction available U/s 24

Basis of computing of Income from House Property:

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Income from House property is computed as under :

Gross Annual value **********

Less : Munispal Taxes (*********)

(It is deductible when it is born by the owner and actually paid by him during the year.
)

Net Annual value **********

Less : Deduction U/s 24

(i)Standard Deduction @ 30% ( Section 24(a) (*********)

(ii)Interest on borrowed Capital (Section 24(b) (*********)

Income from House Property **********

Gross Annual Value (GAV)

Why ‘Gross Annual Value’ is calculated to compute income from house property?

The answer to this is that tax on house property is not on actual rent but on inherent
capacity of building to generate income. In other words, how much rent the property can
fetch. Through Gross Annual Value, taxable income from house property is calculated.

Terminology used in computation of House Property Income.

Fair Rent (FR):Fair rent is the rent, which similar properties in the same locality might
reasonably fetch.

Municipal Valuation (MV): For collecting municipal taxes, local authorities surveys and
value buildings. This valuation is taken as evidence in determining the earning potential of
the building.

Standard Rent (SR): Standard rent is derived from rent prescribed under Rent Control Act.

Expected Rent: The reasonable expected rent is the sum for which a property might
reasonably expect to be let out from year to year. It is derived as higher of Municipal Valuation
(MV) and Fair Rent (FR) but subject to Standard Rent (SR).

Unrealized Rent : Rent which cannot be realized by the owner is unrealized rent.

Loss due to vacancy: It is s a notional loss of rent incurred by owner due to vacancy of the
property.

Actual Rent received or receivable: It is the actual amount of rent received by the owner
from the tenants.

Gross Annual Value

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Gross Annual Value is determined as under:

Step I Find out reasonable expected rent of the property

Step II Find out Actual rent received or receivable ( Note 1

)

Step III Higher of the I or II above

Step Find out Loss due to vacancy

IV

Step V Step III minus step IV is the Gross Annual Value

Note 1: Unrealized rent if any has to be deducted from rent received or receivable

If certain conditions are fulfilled.

Net Annual Value

Gross Annual Value minus Municipal taxes like property tax, paid by the owner.

Deductions from House Property

Following two types of deductions from annual value are available u/s 24 of the Income Tax
Act to arrive at the taxable income from HP.

1. Standard deduction @ 30% of Net Annual value (Note 2)

2. Deduction of Interest on borrowed capital

Note 2: No any other deduction towards expenditure such as insurance, repairs, electricity,
water supply etc. is allowed.

The above procedure is explained with an illustration:

Illustration 1

Mr. Z owns a residential property in Mumbai. He earned ₹ 12,00,000 as a rent from it in

Financial Year 2017-18. The Municipal Valuation (MV) is ₹ 9,60,000, Fair rent (FR) is ₹ 900000
and Standard Rent (SR) under Rent Control Act is ₹ 8,40,000. However, out of ₹ 12,00,000,
unrealized rent is ₹ 1,00,000. Further, He has paid interest of ₹ 4,60,000 in the current year
and in pre construction period Rs. 20,00,000 on loan taken on this property and municipal
tax of ₹ 60,000. What is the Income from House Property of Mr. Z for or Assessment Year
2018-19 (FY 2017-18).

First we have to calculate Gross Annual Value (GAV):

Computation of Gross Annual Value

Particulars Amount

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 Step I : Reasonable Expected Rent (Higher of MV or FR subject to SR ) 8,40,000

Step II : Rent actually received or receivable after reducing unrealised rent ( 1200000- 11,00,000
100000)

Step III : Higher of step I or Step II 11,00,000

Step IV : Loss due to vacancy Nil

Step V : Gross annual value ( Step III- Step IV ) 11,00,000

Now we will compute Income from House property as under:

Computation of Income From House Property

Particulars Amount

Gros Annual Value as above 11,00,000

Less : Municipal Taxes 60,000

Net Annual Value 10,40,000

Less : Deduction u/s 24 Nil

Standard Deduction 30% 3,12,000

8,60,000
Interest On borrowed capital ( 1/5 of 2000000+
460000)

Income From House Property ( loss ) Note 3 (1,32,000)

Note 3: Law in respect of setting of losses from house property has been changed from the
FY 2017-18. How the same is to be adjusted with other source of income or to be carried
forward in subsequent years has been explained in the illistration no 5

Taxability is based on the nature of occupancy of House Property

Income from self occupied property( SOP) :

1. A self occupied property is one which is owned and used by the owner for his own
residential purposes.

2. This is to be occupied by the owner throughout the year. Thus, a property or a house not
occupied by the owner for his/her residence cannot be treated as a self-occupied property

3. No other benefit is derived from such property

Exception to self-occupied house property

There is an exception to the above rule. If the following conditions are satisfied even though
the property can be treated as self-occupied:
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1. If the tax payer owns a property

2. If the property mentioned above is not let-out at any time during the year. (The property
should not be letout in the whole year or any part of the year )

3. If such property could not be occupied by the owner, by reason of the fact that owing to
his employment, business or profession carried on at any other place

4. No other benefit is derived from such property.

The annual value of the self occupied property will always be Nil. No other deduction will be
allowed from it except interest to the extent of Rs 2,00,000 .The interest will be considered as
loss under the head income from house property and adjustable with other source of
income under the same head or in another head. Only one house can be declared as self-
occupied property.

Income from Let out House Property : In case the property is let out, owner will receive
rent from your tenant(s). This rent income will be taxed as your income from house property.
In short, rental income received by the owner from letting out the house property will be
taxed under income from house property. Some times second house property (owned by
the owner) is vacant (not let out), in those cases rent will not be received but same would be
considered as deemed let-out.

Interest on Borrowed Capital (Some important points )

1. Interest on borrowed capital is allowed on accrual basis.

2. Interest on unpaid interest (penalty) is not allowable .

3. Pre-construction interest for borrowed capital is available for deduction meaning thereby
that the interest for the period commencing on the date of borrowing and ended on 31st
March prior to the date of completion of construction/ acquisition of property will be
considered interest of pre- construction period .The deduction is available in 5 equal
installments, commencing from the previous year in which house is acquired or constructed.

4. The income from house property, which is occupied by the owner for the purpose of his
own residence or could not be occupied by the owner for his residential purpose due to his
employment at other place is taken as nil. However, he is allowed as deduction of interest
paid on borrowed capital (including the accumulated interest of the pre-construction period)
up to Rs 2.00 Lacs only.

5. When the assessee has more than one house then, he/she can exercise an option to treat
anyone of the house to be self-occupied. The other house(s) shall be deemed to let out.

Illustration 2 : For calculation of interest on Pre-construction period:

Mr. X has taken loan for construction of the house on 1st Oct 2009 and construction of
house is completed/ possession taken over on 15 Dec 2017.It means interest from
01.10.2009 to FY 2016-17 will be considered as interest of pre- construction period and
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allowed to be claimed in 5 equal installment commencing from the FY 2017-18. Say Total
interest up to FY 2016-17 is Rs. 10,00,000 then it will be allowed to be claimed Rs 200000 per
year from the FY 2017-18 plus actual interest accrued for FY 2017-18.

Interest on Borrowed Capital for self occupied Property:

Maximum ceiling of interest is Rs 2,00,000

Interest on borrowed capital is allowed up to Rs. 200000 (inclusive of pre construction

interest), on fulfillment of the following conditions:

1. Loan is taken after 1/4/1999 for purchase or construction of property.

2. Purchase or construction should be completed within 5 years (3 years up to FY 2015-16)

from the end of financial year when loan is taken. Suppose loan is taken 1/1/2010.
Construction should be completed up to 31/03/15.

3. There is certificate from lender that interest is payable in respect of amount given for
purchase or construction of property.

Maximum ceiling in any other case is Rs 30,000

If all the above three conditions are not satisfied then deduction is allowed up to Rs 30000
only. In other words in the following cases interest on borrowed capital is allowed up to Rs
30,000:

1. If capital is borrowed before 1/4/1999 for purchase, construction, reconstruction, repairs

of a property or

2. If capital is borrowed after 1/4/1999 for repair, reconstruction or renewal of property.

Deduction of interest in Case of Co-Borrower:

If the home loan is taken on joint names then the deduction is allowed to each co-borrower
in proportion to his share in the loan. For taking such deduction, it is necessary that such co-
borrower must also be co-owner of that property. If the assessee is a co-owner but is
repaying the full loan himself, then he can claim deduction of full interest paid by him.

The limit of deduction in case of Self occupied property applies individually to each co-
borrower. In other words, each co-borrower can claim deduction up to Rs. 2 Lacs. Meaning
thereby the Co-owner may claim interest up to Rs 400000 (i.e. Rs 200000 each). No limit is
applicable to let out property.

Illustration 3 : Computation of House Property when part of HP is self occupied and

part is let out

Situation : MR X owns a HP consisting of two units (Unit 1 and unit 2 ). Unit 1 is self occupied
and unit 2 is rented out. Rent of unit 2 is Rs. 6000 pm, and rent of 2 months could not be
recovered. Municipal valuation of property is Rs 130000, Fair Rent is Rs. 140000 and

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Standard rent is Rs 125000. Municipal tax is imposed @ 12% and paid by Mr. x .Interest on
construction of house property is Rs 63000 (borrowed prior to 01.04.1999). Calculate Income
from HP of Mr. X for FY 2017-18.

Solution :

Unit 1 : Self occupied

Gross Annual Value Nil

Less :Municipal Tax Nil

Net Annual Value Nil

Less : Interest on borrowed Capital 30000

Income From Unit I (30000)

Unit 2 : Let Out

Municipal Valuation ( 50% of 130000) 65000

Fair Rent ( 50% of 140000) 70000

Standard Rent ( 50% of 125000) 62500

Rent Receivable ( 6000*12) 72000

Unrealized Rent 12000

Calculation of Gross annual Value

Step I:Reasonable expected Rent ( MV or FR subject to Max of 62500

SR)

Step II Rent received minus unrealized rent 60000

Step III : Higher of Step I and Step II 62500

Step IV : Loss due to vacancy 0

Step V : Step III minus Step IV 62500

Gross Annual Value 62500

Less MT ( 50% of 12% of Rs 130000) 7800

Net Annual Value 54700

Less :Standard Deduction U/s 24 ( 30% of 54700) 16410

Interest on borrowed Capital ( 50% of 63000) 31500

Income Of unit II 6790

Total Income Under House Property ( Unit I + Unit II ) (Loss) (23210)

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Illustration 4 : Computation of House Property when in the part of the year it is self
occupied and let out for the remaining period

Situation : MR X owns a HP . Municipal Valuation of property is Rs 164000, and Fair rent is Rs

216000, Standard rent is 180000. Property is let out up to 31.01.2017 on monthly rent of Rs
14000 pm and self-occupied from 01.02.2017. Municipal tax is Rs 6000 paid by Mr. X .Interest
on construction of house property is Rs 212000 . Calculate Income from HP of Mr. X for FY
2017-18.

Solution: In this situation the computation will be made as let out property and benefit of
self occupied property will not be available

Calculation of Gross annual Value

Step I:Reasonable expected Rent ( MV or FR subject to Max of SR) 180000

Step II Rent received less unrealized rent but before adjusting loss due to 140000
vacancy

Step III : Higher of Step I and Step II 180000

Step IV : Loss due to vacancy 0

Step V : Step III minus Step IV 180000

Gross Annual Value 180000

Less MT 6000

Net Annual Value 174000

Less (i) Standard Deduction U/s 24 ( 30% of 174000) 52200

(ii) Interest on borrowed Capital 212000

Income Under the Head Income from House Property (Loss) (90200)

Major Changes Applicable from the Financial Year 2017-18

Until FY 2016-17, Loss under the head Income from House Property could be set off against
other heads of income without any limit. However, from FY 2017-18, such set off of losses
has been restricted to Rs 2 lakhs only.

This amendment would not effect on self-occupied house property, however this will have an
impact on let-out properties. Though there is no bar on the amount of interest that can be
claimed as a deduction under Section 24 for a rented house property, but the losses which
arises on account of such interest repayment can be set off with other heads of income)
only to the extent of Rs 200000 lacs .

Illustration 5: Explaining the concept and impact

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Mr. X is residing in Delhi has a salary income of Rs 10 lakhs for FY 2016-17 and FY 2017-18 and
Interest income from FD of Rs 4 lakhs. He owns three residential house properties as under:

Property Self-occupied for which Interest on housing loan paid Rs 280000

A
(Delhi )

Property This properly could not be occupied because of employment in Delhi. So it is considered as deemed
B let out .Annual value is considered as Rs 300000 .Interest on housing loan is Rs 240000
(
Bombay
)

Property Let out for residential purpose , the annual value is Rs 5,20,000 and Municipal taxes Rs 20,000
C .Interest on borrowed capital is Rs 600000
( Delhi )

Computation of total income and tax liability

Description FY 2016-17 FY 2017-18

Salary income 1000000 1000000

FDR interest 400000 400000

Income from HP ( see working below ) *(390000) *(200000)

Gross total income 1010000 1200000

Deduction 80C (150000) (150000)

Taxable income 860000 1050000

Tax including cess 99910 131325

Additional tax out go due to 31415

amendment

*Working on computation of Income from House property

FY 2016-17 FY 2017-18

Property A
(Self-
occupied)

Annual value Zero Zero

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Less :Interest 200000 200000
on loan
limited to Rs
200000

Loss from (200000) (200000)

House
Property A

Property B (
Deemed Let-
out )

Annual value 300000 300000

Less : Interest 240000 240000

on housing
loan

Net Income 60000 60000

from House
Property B

Property C (
Let- Out )

Gross Annual 520000 520000

Value

Less 20000 20000

:Municipal
Taxes

Net annual 500000 500000

Value

Less 150000 150000

:Standard
Deduction
30%

Less : 600000 600000

Interest (pre
Construction+
Current)

Loss from (250000) (250000)

House
Property C

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 Total (390000) (390000)
Income
(Loss ) from
House
Property ( A+
B +C )

Adjustment of The loss of Rs 390000 is fully adjusted with the other income Out of above loss only
loss and say with the salary. If unadjusted in the same year then to carry 200000 will be adjusted
carry forward forward in next 8 AY to be adjusted with house property with other Income (say with
in subsequent Income only. Here all the losses can be adjusted with salary salary).
year Balance loss of 190,000 will
be carried forward in next 8
AY and to be adjusted with
house property Income Only.

Deduction under Section 80C – Towards Principal Repayment

Section 80C provides for deductions from gross total income in respect life insurance,
provident fund, National Saving Certificate, tuition fees, equity oriented mutual funds, fixed
deposits scheme, Senior Citizens Saving Scheme etc. In addition to this, 80C also offers
deduction in respect of repayment of housing loan take for purchase or construction of
residential property. Maximum amount qualified for deduction under section is Rs. ,50,000.
The deduction in respect of repayment of housing loan also falls under this limit. In other
words, if taxpayer had made repayment of Rs. 3,00,000 towards principal, he can claim
deduction only up to Rs. 1,50,000 under this section .The taxpayer can also claim deduction
stamp duty, registration charges and other expenses incurred for transfer of house property
in his name subject to maximum limit of Rs.1,50,000. However, if the taxpayer transfers the
house property before 5 years, then all the deduction already taken in previous years will be
deemed as income in which the house property is transferred.

Additional Deduction U/S 80EE up to Rs 50,000 to First Time Buyer

From the FY 2016-17 and subsequent year an additional deduction of interest up to Rs

50,000 can be claimed to first time buyer of residential house property. The condition in this
regard is as under:

♦ Conditions :

1. The assessee is an individual, whether resident or non -resident.

2. Loan should be for acquision of residential house property.

3. Loan should be from bank or housing financing company.

4. Loan amount should not exceed Rs 35 Lacs.

5. Loan should be sanctioned during 01.04.2016 to 31.03.2017

6. The value of the house should not be more than Rs 50 Lacs

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7. Home buyer should not have any other existing residential house in his name at the time
of sanction of loan.

♦ Amount of Deduction: If the above conditions are satisfied, assessee can claim the
deduction under section 80EE. Deduction is available of Rs 50000 or interest payable,
whichever is lower. The deduction is available for the financial year 2016-17 and subsequent
year.

♦ Double deduction not allowed: If the deduction is claimed under section 80EE, no
deduction will be allowed in respect of this amount under any other provisions of the act (say
under section 24) for the same year or any other financial year.

Illustration6: Explaining the concept of 80EE

Assessee Application Date of sanction Amt Value Whether Assessee own any Interest
Name date of loan of of HP HP on the date of sanction payable for FY
loan of loan 2016-17

X( case 11.03.16 10.05.16 35 50 No 78000

1) lacs Lacs

Y (case 11.03.16 10.05.16 35 50 No 50000

2) lacs Lacs

A( case 11.03.16 10.05.16 35 50 No 10000

3) lacs Lacs

B( case 20.03.17 10.05.17 35 50 No 50000

4) lacs Lacs

C( case 11.03.16 10.05.16 36 50 No 50000

5) lacs Lacs

D( case 11.03.16 10.05.16 35 51 No 50000

6) lacs Lacs

E( case 11.03.16 10.05.16 35 50 Yes 50000

7) lacs Lacs

F (case 11.03.16 01.01.17 35 50 No FY 2016-17 Rs

8) (Construction lacs Lacs 135000
completed on FY 2017-18
01.06.18) 315000

FY 2018-19

Rs 315000

Solution :

Assessee Description
Name

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X (case Deduction u/s 80EE available of Rs.50000. Satisfied all the condition.
1) In respect of this interest deduction u/s 24 or any other section not available . However for
the balance amount of Rs 28000 deduction may be claimed u/s 24

Y (case Deduction u/s 80EE available of Rs.50000. Satisfied all the condition.
2)

A (case Deduction u/s 80EE available of Rs.10000. Satisfied all the condition.
3)

B (case Date of sanction is not in FY 2016-17 so deduction u/s 80EE is not applicable. However he can
4) claim deduction u/s 24 .

C (case Amount of loan sanction is more than Rs 35 lacs therefore deduction u/s 80EE is not
5) applicable. However he can claim deduction u/s 24 .

D (case Cost of property is more than Rs 50 lacs ,Deduction u/s 80EE is not available . Deduction
6) under section 24 may be claimed.

E (case Deduction u/s 80EE not available as he owns another property on the date of application.
7) However deduction u/s 24 may be claimed.

F (case Deduction u/s 80EE of Rs 50000 for FY 2016-17 can be claimed

8) Deduction u/s 80EE of Rs 50000 for FY 2017-18 can be claimed

Deduction For FY 2018-19 :

If Self Occupied: Total interest of pre-construction period is Rs 450000 (135000 + 315000) .

Out of this Rs 1,00,000 has been availed u/s 80EE for each year in the FY 2016-17 and FY
2017-18 . Balance tax benefit in FY 2018-19 is Rs 250000 ( i.e . u/s 80EE ,Rs 50000 + Rs 200000
u/s 24)

If Rented : Total interest of pre-construction period is Rs 450000 (135000 + 315000) . Out of

this Rs 1,00,000 has been availed u/s 80EE for each year in the FY 2016-17 and FY 2017-18 .
Balance amount Rs 350000 will be divided in 5 equal installment i.e. Rs. 70000 in each year
and will be available from the FY 2018-19. Hence Total interest to be availed in FY 2018-19 is
Rs 385000 ( i.e. (70000+315000)

Whether tax benefit of HRA and Deduction of Interest can be claimed simultaneously
(Different situation of Tax benefit of HRA and Interest )

Situation Mr. X, is residing in his house in Delhi, which was purchased with the housing loan from the
1 bank

Answer He is residing in his own house, he may get HRA but exemption benefit is not available, since
the rent receipt is not provided for own house. However, tax benefits on both, the principal
repayment and interest is available.

Situation Mr.X is residing in Delhi in a rented house but had bought an apartment in Chennai taking a
2 home loan.

Answer He will be entitled for exemption benefit of HRA and tax benefits on both, the principal
repayment and interest on the home loan
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 Situation Mr. X has bought a house in Mumbai, which is under construction taking a home loan and
3 currently living in Mumbai in a rented apartment because the house is under construction.

Answer In such a case, Mr. X is eligible to claim HRA tax benefit and tax benefit on the home loan for
the principal repayment and may claim tax benefits on the interest also.

Situation Mr. X has bought a house in Delhi taking a home loan but residing in a rented apartment in
4 Delhi for genuine reasons e.g. the house is for away from the office.

Answer The individual can claim HRA tax benefit and home loan benefits, which includes both
principal repayment and interest accrued. If no genuine reason, ITO may dispute the tax
benefit

FAQ on Rental Income From House property

Q.1 Is rental income from sub-letting chargeable to tax under the

head “Income from house property”?
Ans: Rental income in the hands of owner is charged to tax under the head “Income from
house property”. Rental income of a person other than the owner can not be charged to tax
under the head “Income from house property”. Hence, rental income received by a tenant
from sub-letting can not be charged to tax under the head “Income from house property”.
Such income is taxable under the head “Income from other sources” or profits and gains
from business or profession, as the case may be.

Q.2 Under which head is the rental income from a shop charged to
tax?
Ans : To tax the rental income under the head “Income from house property”, the rented
property should be building or land appurtenant thereto. Shop being a building, rental
income will be charged to tax under the head “Income from house property”.

Q.3 What is the tax treatment of composite rent when the composite
rent pertains to letting of building along with other assets?
Ans: Composite rent includes rent of building and rent towards other assets or facilities. The
tax treatment of composite rent is as follows:-

(a) In a case where letting out of building and letting out of other assets are inseparable (i.e.,
both the lettings are composite and not separable, e.g., letting of equipped theatre), entire
rent (i.e. composite rent) will be charged to tax under the head “Profits and gains of business
and profession” or “Income from other sources”, as the case may be. Nothing is charged to
tax under the head “Income from house property”.

(b) In a case where, letting out of building and letting out of other assets are separable (i.e.,
both the lettings are separable, e.g., letting out of refrigerator along with residential
bungalow), rent of building will be charged to tax under the head “Income from house
property” and rent of other assets will be charged to tax under the head “Profits and gains of
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business and profession” or “Income from other sources”, as the case may be. This rule is
applicable, even if the owner receives composite rent for both the lettings. In other words, in
such a case, the composite rent is to be allocated for letting out of building and other
facilities.

Q.4 Can interest paid on loans taken from friends and relatives be
claimed as deduction while calculating house property income?
Ans: Yes, if the loan is taken for purchase, construction, repair, renewal or reconstruction of
the house. If the loan is taken for personal or other purposes then the interest on such loan
cannot be claimed as deduction.

Q.5 My spouse and I jointly own a house in which both of us have

invested equally out of independent sources. Can the rental income
received be split up between us and taxed in the individual hands?
Ans: Yes, if the share of each co-owner is ascertainable

Q.6 What will be the tax implications if a person occupies more than
one property for his residence? Can he treat all the properties as self
occupied (SOP) and claim gross annual value (GAV) as Nil?
Ans: The SOP benefit (i.e., treating property as SOP and claiming GAV as Nil) is available only
in respect of one property occupied by the owner for his residence. If a person occupies
more than one property for his residence, then the SOP benefit will be granted only in
respect of any one property as selected by him and other property/properties will be
treated as “Deemed to be let-out”.

Q.7 Mr x owns two houses. One is a farmhouse that he visit on

weekends and the other is in the city that he uses on weekdays. Is it
correct to treat both these residences as self occupied?
Ans: No, for the purpose of Income-tax law you can claim only one property as self occupied
property and other property will be deemed to be let-out property

Q.8 What is the tax treatment of arrears of rent?

Ans: The amount received on account of arrears of rent (not charged to tax earlier) will be
charged to tax after deducting a sum equal to 30% of such arrears. It is charged to tax in the
year in which it is received. Such amount is charged to tax whether or not the taxpayer owns
the property in the year of receipt.

Disclaimer

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Author does not make any claim that the information provided in this article is correct and
up-to-date. The contents of this article cannot be treated or interpreted as a statement of
law. The reader may visit Income Tax Web site for resolving their doubts/clarifications.

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