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Rashmin Sanghvi & Associates

Chartered Accountants

220, 2nd Floor, Arun Chambers,
Tardeo Road,
Mumbai - 400 034,
Maharashtra, India.

Tel. Nos.: (+91 22) 2351 1878, 2352 5694.

Fax : (+91 22) 2351 5275.

Email : [email protected]

 
Home Articles Taxation         Share :

Budget 2017Chapter H

39. Restriction on set-off of loss from house property [S. 71]:

Presently, Section 24 allowed expenses to be claimed against income from let-out property without any limit. This could result in losses under the head “Income from House Property”. Further, loss under income from house property is allowed to be set off u/s. 71 during the same year against income earned under other heads. Due to high interest costs, there could be significant losses under the head “Income from House Property” which would bring down the total taxable income.

Finance Bill proposes to restrict the set-off of loss incurred from House Property against income under other heads to the extent of Rs. 2 lakhs.

Example 6:

An Indian resident earns income from following sources in FY 2017-18:

Source Amount

Source

 

Amount

Income from Salary

 

50,00,000

Income from House Property

 

(10,00,000)

Income from Other Sources

 

5,00,000

 How much House Property loss can be set-off during the year and how much loss can be carried forward?

Source

 

Amount

 

Amount

Income from Salary

     

50,00,000

Income from House Property

 

(10,00,000)

 

 

Less: Restricted to (S. 71)…

     

(2,00,000)

Income from Other Sources

     

 5,00,000

Gross Total Income

     

53,00,000

The balance house property loss of Rs. 8,00,000 can be carried forward for 8 years as per S. 79.