Calculate Rent for Deemed Let-Out Property
Owning a home is a dream for many. However, if you own more than two properties for personal use, the additional properties will be treated as deemed let-out. This means you’ll need to pay tax on the notional rental income. Keep reading to learn how rent is calculated for deemed let-out properties.
Calculate rent for Deemed let-out property
Expected rent is the higher of the following:
- Fair Rent Value: The rent expected for a similar property in the same area
- Municipal Value: The rent determined by municipal tax laws
- Standard Rent: The rent as defined under the Rent Control Act (if applicable)
Note: Any losses from deemed let-out properties cannot be set off or carried forward.
Steps to add a Deemed Let-Out property
- Go to File > Incomes > House Property
- Select Add Manually
- Choose the property type as Deemed Let-Out
- Enter the property address and rental income details
- Claim the deductions for municipal taxes and interest on home loan
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