While presenting interim Budget 2019-20 FM proposed to exempt the levy of income tax on notional rent on a second self-occupied house subject to

It has been proposed to exempt the levy of income tax on notional rent on a second self-occupied house.  Currently, income tax on notional rent is payable if one has more than one self-occupied house.  Shri Goyal announced the relief considering the difficulty of the middle class having to maintain families at two locations on account of their job, children’s education, care of parents etc.

Proposed Amendment of section 23 of Income Tax Act, 1961

In section 23 of the Income-tax Act, with effect from the 1st day of April, 2020,––

(a) in sub-section (4),––

(i) in the opening portion, for the words “one house”, the words “two houses” shall be substituted;

(ii) in clause (a), for the word “one”, the word “two” shall be substituted;

(iii) in clause (b), for the words “other than the house”, the words “other than the house or houses” shall be substituted;

(b) in sub-section (5), for the words “one year”, the words “two years” shall be substituted.

Proposed Amendment of section 24 of Income Tax Act, 1961

In section 24 of the Income-tax Act, with effect from the 1st day of April, 2020,––

(a) in the first proviso, after the words “the amount of deduction”, the words “or, as the case may be, the aggregate of the amounts of deduction” shall be inserted;

(b) in the second proviso, after the words “the amount of deduction”, the words “or, as the case may be, the aggregate of the amounts of deduction” shall be inserted;

(c) after the Explanation to the third proviso, the following proviso shall be inserted, namely:––

“Provided also that the aggregate of the amounts of deduction under the first and second provisos shall not exceed two lakh rupees.”.

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