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

Sunrise Traders Ltd. owns a building held as stock-in-trade and has never let it. The completion certificate was obtained in the financial year ending 31 March 2027. Under section 21(5) as amended w.e.f. 1-4-2026, up to when is its annual value nil?

The annual value stays nil up to two years from the end of the financial year in which the completion certificate is obtained. This applies to stock-in-trade property that is not let wholly or partly at any time in the tax year.

  1. AFor one year from the end of that financial year
  2. BOnly during the year in which the certificate is obtained
  3. CUp to two years from the end of the financial year in which the certificate is obtainedCorrect
  4. DIndefinitely, until it is sold

Explanation

Section 21(5) provides that for a property held as stock-in-trade and not let at any time in the tax year, the annual value is nil up to two years from the end of the financial year in which the completion certificate is obtained. One year or indefinite periods are not what the section states. Letting during the year would remove this relief.

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