Reg rental income tax with care taker

hello,

I have given rent my house in Rs 15000. Now company to whom  I given house, wants care taker with 12000 salary and they wanted to me have updated agreement  with care taker and I can provide them bill of rent and salary of care taker and they will reimburse the amount paid to care taker  .

is any extra tax implication for me? Can I deduct the salary I pay to care taker and show rental income which is actual for house rent.
Example if I get

Rs15000 as hosue rent
Rs 12000 for care taker from tanant company 

============
Rs 27000

can  I now after paying back Rs 12000 to care taker and show in my income tax return as rs 15000 which is actual income after paying salary to care taker?


Please let me know if above deduction  allowed for individual tax payee? 
thansk,
Satish
Asked 7 months ago in Income Tax from raipur, Chhattisgarh
In the present case the amount of Rs.12000 paid to care taker is not taxable as this is not an income but reimbursement of expenses.
Shyam Sunder Modani
CA, Hyderabad
955 Answers
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Dear Sir,

Yes you can show like you are providing manpower service and the receipt is straightaway paid to the Care taker. But instead I would advise you to take only your share of rent in your bank account and ask the Company to pay the Caretaker directly if you are not making any money on the same.

Trust this clarifies your query. 

Feel free to get back/ call back in case of further details. 

Thanking You. 

Regards,
Rohit R Sharma
BCOM, ACA, LLB - GEN, CERT. FAFP
Rohit R Sharma
CA, Mumbai
719 Answers
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Dear Sir,
In income tax act 1961, the reimbursement is not taxable. In your case the income chargeable under the head "Income From House property" (Section 22) will be 15000 As house rent. It is advisable to take amount for care taker in cash.Standard deduction will be allowed @ 30% From NAV.

Trust this clarify your Query.
For any other query please feel free.

 
Shiv Kumar Agarwal
CA, Delhi
197 Answers
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Dear Sir,

Where the value of other amenities such as Watchmen, sweeper, Gardner, etc. was provided by landlord to the tenant under a separate agreement , it was held that value of other amenities such as watchmen, Gardner, etc. are provided by the landlord under a separate agreement shall not be included while computing ALV u/s 23.

Though the assesses received composite rent , but the value of such amenities provided was a separately accounted for, and thus ALV should be determined excluding value of such amenities. 

[DCIT V Sir Sobha Singh & Sons (P.) Ltd. (2014) 41 Taxmann.com 378 (Del) ( Trib)]
Shiv Kumar Agarwal
CA, Delhi
197 Answers
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No problem. If it is reimbursement it is not taxable even if it is received by cheque
Shyam Sunder Modani
CA, Hyderabad
955 Answers
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Dear Sir,

The matter under consideration is very litgious. I would advise you to prepare two separate agreement if possible and receive the amount in two installment provide two separate receipts. 
There are favourable judgements available but need to maintain string documents as mentioned above.

Thanks and Regards,
CA Abhishek Dugar
caabhishekdugar@gmail.com
Abhishek Dugar
CA, Mumbai
766 Answers
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Hello Satish,

As I said earlier, it is a litigative matter. If you ask me is it taxable, then the answer is NO. But if you ask me will the AO agree to it on the face then he may not and unnecessarily harass you. 

So a precautionary step, if you are not making money out of the transaction then take a Direct Cheque in the name of the Caretaker.

Trust this clarifies your query. 

Feel free to get back/ call back in case of further details. 

Thanking You. 

Regards,
Rohit R Sharma
BCOM, ACA, LLB - GEN, CERT. FAFP
Rohit R Sharma
CA, Mumbai
719 Answers
5.0 on 5.0
  Talk to Rohit R Sharma

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