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CS Executive · Tax Laws and Practice · Income under the Head House Property

Mr. Raman owns a flat in Pune and lives in it himself throughout the tax year. He has no other house. What is the annual value of this flat under the Income-tax Act, 2025?

The annual value is nil. Under section 21(6), a house that the owner occupies for his own residence has a nil annual value, and this treatment is available for up to two houses chosen by the assessee, provided it is not let and yields no other benefit.

  1. ANil, as it is a house occupied for his own residenceCorrect
  2. B30% of the reasonably expected rent
  3. CReasonably expected rent less municipal taxes
  4. DReasonably expected rent with no deduction

Explanation

Section 21(6) says the annual value of a house the owner occupies for his own residence is nil. This applies to up to two houses specified by the assessee under section 21(7)(a). Since he uses it only as a residence and derives no other benefit, the nil value applies.

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