QUESTIONS & ANSWERS
Relief in cases of self-occupation
The law allows exemption of one self-occupied house. I am not deriving any income from the other house which is used by me only for a part of the year though available to me for the entire year. I presume that I can choose the property for the benefit of self-occupation for one and pay tax on the annual value of the other property. Is my inference correct? Am I entitled to ad hoc deduction at 30 per cent of the gross value in respect of property on which I had chosen to pay tax on notional income?
The reader’s inference that he can choose for exemption either property with normal tax on the other is correct. In fact, he can make the choice in a manner that would give him tax advantage by claiming exemption for a more valuable property with a larger annual value. Ad hoc deduction at 30 per cent from notional income from the other self-occupied house is statutory and, therefore, allowable.
S. RAJARATNAM
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