Navigating the Tax Maze: How to Report Rental Income in Your IT Return?
If you earn rental income from a property that you own, you are required to report it in your Income Tax (IT) return. Here’s how you can include rental incomes in your IT return file:
- Determine the Gross Annual Rental Value: The Gross Annual Rental Value is the total rental income that you earn from your property over the course of a year. This value will be used to calculate the taxable income that you will report in your IT return.
- Calculate the Net Annual Value: The Net Annual Value is the amount of rental income that is subject to taxation after accounting for allowable deductions. Allowable deductions include municipal taxes, repair expenses, and maintenance costs.
- Report the Rental Income in the Appropriate Schedule: Rental income should be reported in the IT return under the Schedule ‘Income from House Property’. This schedule requires you to provide details such as the Gross Annual Rental Value, any deductions claimed, and the final taxable income.
- File the IT Return: Once you have reported your rental income, you can file your IT return using the appropriate form based on your tax status. You can file your IT return either online or offline through the income tax department’s website.
- Pay any Taxes Owed: If your rental income exceeds the basic exemption limit, you will be required to pay income tax on the taxable income calculated on the rental income. You can pay any taxes owed either online or offline through the income tax department’s website.
It’s important to note that rental income is subject to different tax rules than other types of income, so it’s a good idea to consult with a tax professional or financial advisor if you have any questions about how to properly report your rental income in your IT return file.
Disclaimer: The views expressed above are for informational purposes only based on industry reports and related news stories. PropertyPistol does not guarantee the accuracy, completeness, or reliability of the information and shall not be held responsible for any action taken based on the published information.
