Deemed rent

Hi

Yes, considering that 2 SOP properties are allowed from FY 2019-20, you don't need to pay tax on deemed rent of Shop. Yes, shop is included in 2 SOP.

Hi,

- From F.Y. 2019-20, two self occupied house properties are allowed. Yes, shop is a part of the house property. In your case if the shop remains vacant for the whole year then you need to evaluate the option of considering two SOP out of three having minimum tax outflow.

Thanks

Hi,

The benefit of self occupied property has been increased from one property to two house property. This means that the income tax on notional rental income will not be taxed on the second house property. However, if you have more than two self-occupied houses, then in such cases additional houses over and above will be taxed accordingly.

You will get benefit of 2 houses even if both are self occupied by you there is no separate condition.

As far as shop goes even though it is covered under house property income but it wont be covered under the amendment of 2 SOP as section 23 uses the word 2 house and shop cannot be covered in that definition so you need to pay deemed rent on such shop even if you have only one house.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you.

House property as per the Income-tax Act, 1961 means any building (or land adjacent to such building) owned by assessee himself. House property includes flats, shops, office space, factory sheds, commercial building, agricultural land and farm houses etc.

I dont think house definition in section 23 covers shops.

2 house property allowed as SOP

Hello,

From F.Y. 2019-20, it is allowed to consider two properties as SOPs. Shop can be included in two SOPs.

I hope this answer satisfies your requirement.

Regards,

CA Hunny Badlani

Hi,

- Shop is covered under the definition of house property.

- Two SOP houses will be covered from F.Y. 2019-20.

House property includes commercial buildings, office space, shops etc., 

Also, two house properties can be allowed as SOP from FY 2019-20 as per the recent amendment. Also, since you have more than two SOP,  select the house properties as SOP in a way that you pay lesser tax. 

Hello Sir,

Shops are also part of house property.

There is no need to pay tax on deemed rent from shop.

Hi,

Recheked the section and it appears that it is difficult to get the exemption in respect of shop becasue the word used is house for residence in that sub-section.

However, if you are using the shop for business or as godown, you dont eed to pay deemed rent.