What is the impact of tax deductions if I decide to give the second property on rent? Also, the calculation of income from house property in the above case is likely to result in an additional loss. Can I get the benefit of tax reduction while calculating the TDS on my salary or, will I have to claim the refund only while filing the income tax returns?
If you decide to give the second property on rent, the calculation of income (or loss) for that property is fairly simple. The annual value will be, the amount of rent receivable minus municipal taxes and a standard deduction equal to 30% of the annual value is available as well.
If this calculation, results in an additional loss you will need to file a statement along with verification with your employer; giving details of the calculation of loss under the head Income from House Property as well as the tax deducted at source by your tenant, if any. Your employer will then have to take this into account while calculating the amount of tax deductible on your salary income.
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