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

Under the Income-tax Act, 2025 (applicable from the June 2027 session), which of the following is correct about the income chargeable under the head 'Income from house property'?

The annual value of a building or appurtenant land owned by the assessee is taxed as house property income. A portion the owner occupies for his own business or profession, whose profits are taxable, is excluded. Ownership is the test, and letting is not required.

  1. AThe annual value of buildings or lands appurtenant thereto owned by the assessee is chargeable, except portions occupied by the assessee for his own business or professionCorrect
  2. BThe annual value of any building is chargeable, whether or not the assessee is the owner, if he occupies it
  3. COnly the actual rent received by the owner is chargeable, and never any notional amount
  4. DBuildings and appurtenant lands are chargeable only when they are let out throughout the tax year

Explanation

Section 20 charges the annual value of buildings or appurtenant lands owned by the assessee to tax under this head. Portions occupied by the assessee for a business or profession whose profits are taxable are excluded. The option based on occupation alone ignores the ownership requirement, and the option on actual rent alone ignores the deemed annual value.

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