Tax is also applicable on rental income. If you earn Rs 10 lakh from rent then let us know how you can pay zero tax.
This time a major change was made in the budget regarding tax. Finance Minister Nirmala Sitharaman while announcing under the new tax regime said that no tax will be applicable on income up to Rs 7 lakh, but if it is more than this then you will have to pay tax.
Whereas if you are taking income from rent then there is no need to pay any tax on income up to Rs 10 lakh. Let us know some ways, under which you will not have to pay any tax on income of Rs 10 lakh.
Under the new tax regime, if your income is Rs 7.5 lakh, then you can avail the standard deduction of Rs 50 thousand.
On annual income of more than Rs 7 lakh, 5 percent tax has to be paid, on annual income of Rs 3 to 6 lakh, 10 percent tax has to be paid on annual income of Rs 6 to 7 lakh.
However, if the income earned from rent is Rs 10 lakh, then exemption can be claimed under the new tax system. This exemption can be taken under property tax and home loan interest rate payment.
Deduction up to 30 percent on net annual income can be claimed for repair and maintenance of the house. This means that you can get a rebate of up to Rs 3 lakh on an income of Rs 10 lakh, that is, your total income will become Rs 7 lakh and you will not have to pay any tax.