HOW TO CALCULATE THE ANNUAL VALUE OF YOUR HOUSE PROPERTY

HOW TO CALCULATE THE ANNUAL VALUE OF YOUR HOUSE PROPERTY

GROSS ANNUAL VALUE                           XXXX

LESS: MUNICIPAL TAXES PAID                 XXXX

ANNUAL VALUE (NET)                             XXXX

LESS: DEDUCTION U/S 24

       1. STANDARD DEDUCTION                XXXX      

       2. INTEREST ON BORROWED

          CAPITAL                                   XXXX

INCOME UNDER HEAD HOUSE PROPERTY      XXXX

FOR THE PURPOSE OF CALCULATING STANDARD DEDUCTION UNDER SECTION 24, THIS DEDUCTION IS ALLOWED AT THE RATE 30 PERCENT FOR EXPENSES INCURRED IN RELATION TO PROPERTY SUCH AS REPAIR, COLLECTION, INSURANCE PREMIUM PAID FOR PROPERTY ETC. THIS DEDUCTION CAN BE CLAIM BY ASSESSEE IRRESPECTIVE OF AMOUNT ACTUALLY SPEND.

FOR THE PURPOSE OF CALCULATING INTEREST ON BORROWED CAPITAL, IF ANY LOAN IS TAKEN BY ASSESSEE FOR PURCHASE, CONSTRUCTION, REPAIR, RENEWAL OR RECONSTRUCTION OF BUILDING, THE DEDUCTION IS ALLOWED ON ACCURAL BASIS, EVEN IF NOT ACTUALLY PAID AND IF ANY INTEREST IS PAID PRIOR TO COMPLETION OF CONSTRUCTION OR PURCHASE OF HOUSE THEN ANY INTEREST IS PAID, THE DEDUCTION OF INTEREST SO PAID IS ALLOWED DEDUCTION IN 5 EQUAL INSTALMENT STARTING FROM THE YEAR OF PURCHASE OR COMPLETION OF INTEREST. THE MAXIMUM DEDUCTION CAN CLAIM ASSESSEE IS Rs 30,000 OR Rs 1,50,000 IN ANY FINANCIAL YEAR, FOR THE PURPOSE OF CLAIMING DEDUCTION OF Rs 1,50,000 THE HOUSE IS CONSTRUCTED ON OR AFTER 1^ST APRIL, 1999 AND CONSTRUCTION COMPLETED WITHIN 3 YEARS.

TAX TIP

THE ASSESSEE CAN PURCHASE HOUSE PROPERTY IN CO-OWNERSHIP AND THE HOUSE PROPERTY IS SELF-OCCUPIED THEN ASSESSEE SHALL BE ENTITLED TO THE DEDUCTION OF Rs 30,000/1,50,000