I have come across many cases where people asked me this question. Many NRIs are not fully informed of the tax provisions with respect to house property in India.
Let’s take an example of Mr. Santosh, who invested in an apartment in India for ₹ 50 lakhs. He paid ₹ 10 Lakhs from his own savings and took ₹ 40 Lakhs as a home loan from the Bank.
He rented his home and the rental income from the property is ₹ 25,000 per month. Mr.Santosh also pays property taxes of ₹ 10,000 per year and pays ₹ 30,000 for Property Management services.
Mr. Santosh’s monthly rental income = ₹ 25,000
Yearly rental income = ₹ 25,000*12 = ₹ 300,000
1. No tax below ₹ 250,000/annum per individual: You don’t need to pay taxes if your income is below ₹ 250,000/annum.
2. Standard deductions: Take advantage of the standard deduction of 30% on the net annual value. As per the above example, 30% net annual value is ~ ₹ 90,000
3. Municipal taxes: You can get a deduction on taxes paid to the municipal authority for the rented property
4. Interest on loan repayment: Interest paid on the loan repayment taken for construction or repairs or renovation of the rented property
You can avail more tax benefits if the property is owned jointly.
If it is so simple to manage your rental income then why not follow tax compliances and live stress-free.
For more details please contact us.
Visit our website www.gharbefikar.com
#blogging #propertymanagement #rent #sale #pune #nri #india #gharbefikar