vinujaglan.com · Founder's official site 
How rent is taxed
| Step | Amount |
|---|---|
| Gross annual value (rent received or receivable) | A |
| Less: municipal taxes paid by you | B |
| Net annual value | A − B |
| Less: 30% standard deduction | 30% of NAV |
| Less: interest on home loan for that property | Actual interest |
| Income from house property | Balance |
TDS your tenant may deduct
| Tenant | Section | Rate |
|---|---|---|
| Business or professional tenant (audit cases, companies, firms) | 194-I | 10% on rent above ₹50,000 a month |
| Individual / HUF tenant not under audit | 194-IB | 2% if rent exceeds ₹50,000 a month |
GST on rent
- Residential rent to a family for living — exempt
- Residential rent to a GST-registered business — the tenant pays 18% under reverse charge
- Commercial rent — 18% if your aggregate turnover crosses ₹20 lakh; if you are unregistered and the tenant is registered, the tenant pays under reverse charge
House-property loss
In the old regime, a loss (mainly from home-loan interest) can be set off against other income up to ₹2 lakh a year and the rest carried forward for 8 years. In the new regime, a loss from a let-out house cannot be set off against other heads.
Common mistakes
- Not reporting rent because the tenant deducted no TDS
- Claiming the 30% deduction on vacant-land or shop-furniture rent
- Ignoring GST on commercial rent above ₹20 lakh
Frequently asked questions
Yes, rent from buildings — residential or commercial — is house property income, unless letting is your business.
If you own more than two self-occupied houses, the others are deemed let out at a reasonable rent.
Last reviewed on 11 November 2026 by Vinay Jaglan, VJ & Associates. Law and portal screens change — verify before acting, or ask the office.
