ITR filing deadline for 2025 approaches, the real estate investors in India must confirm they fulfil the tax regulations to avoid penalties and make best use of their tax savings. Real estate investment is a common avenue for wealth generation, and for several investors, it’s a prime source of income.
Nevertheless, the complication of managing various income streams, such as rental income, capital gains from property sales, and deductions on home loans, involves careful tax planning.
ITR filing for the investors having rental income
Real estate investors require to file their Income Tax Return (ITR) on time, as missing the time limit could lead to heavy penalties, interest on overdue tax payments, and an interruption in claiming refunds. Most critical part of ITR filing for the investors in real estate is to properly report their rental income.
As per Section 22 of the Income Tax Act, income from rent is taxable under the head “Income from House Property.” Investors are also entitled for deductions under Section 24(b) for home loan interest, which can suggestively reduce their taxable income.
Investors having short-term or long-term capital gains
For investors involved in sale of property, capital gains tax must also be calculated very carefully. The capital gains tax for property depends on whether the property is for the short-term or for long-term.
Any property which is sold within a period of two years of purchase is subject to short-term capital gains (STCG) tax, on the other hand, properties held for more than two years and sold thereafter, are eligible for long-term capital gains (LTCG), which derives with numerous exemptions, such as reinvestment in residential property.
With the developing nature of tax laws and the complexities of property-related income, real estate investors must line up timely ITR filing to protect their investments and enhance their financial status.
Also Read: ITR Filing Deadline Extension: Tax Return For Pensioners In 2025? Here’s What Retirees Need To Know
Ankur Mishra is a journalist who covers an extensive range of news, from business, stock markets, IPOs to geopolitics, world affairs, international crises, and general news. With over a decade of experience in the business domain, Ankur has been associated with some of the reputed media brands. Through a sharp eye on global marketplaces along with deep insights and analysis of business strategies, Ankur brings simplicity to the complex economic matrix to decode market trends and empower people.
He is committed to entrenched data, facts, research, solutions, and a dedication to value-based journalism. He has covered trade tariff wars, international alliances, corporate policies, government initiatives, regulatory developments, along with micro- and macroeconomic shifts impacting global fiscal dynamics.
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