House Property Income — Rent, Deemed Rent & Home Loan Deduction
Section 22 to 27 govern house property. One self-occupied property is nil-value; second self-occupied property attracts deemed rent from AY 2020-21. Standard 30% repair deduction (Section 24(a)) and unlimited home-loan interest for let-out (Section 24(b), capped at ₹2L for self-occupied).
- Gross Annual Value: higher of actual rent or expected rent
- Section 24(a): 30% standard deduction on Net Annual Value (after municipal tax)
- Section 24(b): interest deduction — ₹2L SOP, unlimited for let-out
- Pre-construction interest: 1/5th deductible over 5 years post-completion
- Section 80EEA: additional ₹1.5L for affordable home loan (sanctioned FY 19-22)
Definition
House Property Income
What is House Property Income?
Section 22 to 27 govern house property. One self-occupied property is nil-value; second self-occupied property attracts deemed rent from AY 2020-21. Standard 30% repair deduction (Section 24(a)) and unlimited home-loan interest for let-out (Section 24(b), capped at ₹2L for self-occupied).
Key rules to remember
- Gross Annual Value: higher of actual rent or expected rent
- Section 24(a): 30% standard deduction on Net Annual Value (after municipal tax)
- Section 24(b): interest deduction — ₹2L SOP, unlimited for let-out
- Pre-construction interest: 1/5th deductible over 5 years post-completion
- Section 80EEA: additional ₹1.5L for affordable home loan (sanctioned FY 19-22)
Worked example
Let-out Pune flat: annual rent ₹3.6L, municipal tax ₹18k, home-loan interest ₹4L. NAV = ₹3.42L. Std deduction 30% = ₹1.03L. Net = ₹2.39L − ₹4L interest = (₹1.61L) loss, set off up to ₹2L against other income.
Which ITR form applies
- ITR-1 (Sahaj) — Up to ₹50 lakh total income
- ITR-2 — No upper limit
- ITR-3 — No upper limit
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Frequently asked questions
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Related reading
- Which ITR Form Should You File in 2025? Complete Guide (ITR-1 to ITR-4)
- ITR-1, ITR-2, ITR-3, ITR-4 — Which Form Do You Actually Need to File?
- The Ultimate Income Tax Deductions Guide AY 2026-27 — Complete Tax Saving Handbook
- Which ITR Form Should You File in 2026? (ITR-1 to ITR-7 Explained)
- Section 24(b) Home Loan Interest Deduction AY 2026-27: ₹2 Lakh Cap, Pre-Construction, Let-Out vs Self-Occupied & 20 Examples
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Which ITR form is right for me?+
We pick the correct form based on your income heads — salary, business, capital gains, foreign income — and confirm in writing before filing.
via Income Tax Return FilingHow is a home loan EMI calculated?+
EMI is computed using the standard reducing-balance formula: EMI = P × r × (1+r)^N / ((1+r)^N − 1), where P is the principal, r the monthly interest rate and N the tenure in months.
via Home Loan CalculatorDo I get an extra tax deduction?+
Yes — ₹50,000 additional deduction under Section 80CCD(1B), over and above ₹1.5L in 80C.
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