Income Tax Return Filing for Rental Income

If you earn rental income from properties that you own, it's generally mandatory to report it in your income tax return (ITR). Rental income is widely recognized as taxable across various tax jurisdictions worldwide. Thus, it's essential to accurately disclose this source of income to comply with tax regulations and fulfil your obligations as a taxpayer. Consult with Bizfoc for ITR Filing for Rental Income.

What is ITR-1?

ITR-1 is a type of form and generally used for filing an income tax return for those who earn income from pension or job, own a single home, and attain income from other sources except racehorse earnings, and lottery winnings. It is also known as Sahaj.

Eligibility Criteria For Rental Income

Following is the eligibility criteria for Rental Income:

• Individuals who are resident (ordinary resident or not ordinarily resident) and have income from salary, pension, one house property, and income from other sources.
• Total income should not exceed Rs 50 lakh.
• Agricultural income should be up to Rs 5,000.

Documents Required For ITR on Rental Income

ITR-1 requires certain government-issued documents. These are:

• Aadhaar Card
• PAN Card
• Bank Statement/Passbook
• Form 16
• Salary Slips
• Form 26AS
• Form 16A
• Exemptions under Section 80D and 80U
• Capital Gains Statement

Tax Benefits On Rental Income

The following perks and deductions are available to taxpayers who earn rental income on their income tax return (ITR):

1. Loan Repayment: Reduce the principal amount under section 80C
2. Home loan interest: It is deducted under Section 24 of the property code, subject to the previously mentioned prescribed limit. As per section 80C there is reduction in loan repayment of the principal amount.
3. Section 80 EE: There is certain requirements to eligible for a further deduction of Rs 50,000 on interest of home loan.
4. Section 80 EEA: As per the said section the homebuyers deduct a further amount of INR 1,50,000 for home loan interest.

Details Of Tax Deduction

1. Mention the entire amount you've invested and paid in order to qualify for the section 80C deduction.
2. Interest amount on savings accounts that can be written off under section 80TTA.
3. The amount that can be deducted under section 80G for donations.
4. The amount paid toward a section 80D deduction for health insurance premiums.
5. Section 80E allows for the deduction of interest on student loans.
6. Additional payments that qualify for tax deductions include NPS contributions, other donations, and expenses.

What is the TDS on Rent Income?

In the event that you receive rent revenue, the renter would withhold TDS in the following circumstances:

1. Section 194I: If the annual rent exceeds INR 2,40,000, 10% TDS is withheld from the rent of the land or building.
2. Section 194IB: Individual or HUF-deducted TDS on land or building rent (not subject to tax audit). If the rent exceeds INR 50,000 per month or a portion of the month, 5% of the rent is subject to TDS deduction.

House Property Instructions

If the property is self-occupied, provide information about:

• Address of the dwelling property.
• Interest that needs to be paid before construction.
• Interest on the home loan that has been paid or is owed on the property.
• Name, PAN, and percentage of each co-owner's part of the property if it is a co-ownership.

The co-owners' details might be specified as follows: If you are renting out a property, please provide the information below:

• Rent payable and received annually.
• Paid municipal or house taxes.
• Tenant's name and PAN are provided.
• Interest for the home loan has been paid or is owed.
• Interest during the pre-construction phase.
• The property address and, if applicable, the co-owners' information.
• Provide information similar to that of a let-out property, such as the projected yearly rent receivable, in the case of a property that is deemed to be let out.

Why Choose Bizfoc for ITR Filing?

Bizfoc provides the several services related to ITR as they have great team of experts, who are ready to consult, provide services of ITR filing for rental income, along with the timely filing of all necessary compliances as per regulatory standards. The Bizfoc team will ensure that all your financial details are provided accurately, reduce the possibility of omissions or mistakes, and increase your allowable deductions. With the help of Bizfoc, one can efficiently file ITR for rental income.

FAQs for ITR Filing for Rental Income