Rental Income Tax Calculator
Calculate tax on rental income with standard deduction and home loan interest.
Rental Income Details
Tax Breakdown
Deduction Rules
| Deduction | Limit |
|---|---|
| Standard Deduction | 30% of NAV (automatic) |
| Home Loan Interest (Let Out) | No upper limit |
| Home Loan Interest (Self-Occupied) | Max ₹2,00,000/year |
| Loss Set-off | Max ₹2,00,000 against other income |
Rental Income Tax in India — Complete Guide
Rental income from property is taxed under the head "Income from House Property" as per the Income Tax Act, 1961. Whether you own a residential property given on rent, a commercial space, or list your property on Airbnb, the rental income must be declared in your Income Tax Return (ITR). Understanding the deductions available can significantly reduce your tax liability.
How Rental Income is Calculated
The calculation follows a structured approach. First, the Gross Annual Value (GAV) is determined — this is the higher of the actual rent received or the fair rental value of the property. From GAV, municipal taxes (property tax) paid by the owner are deducted to arrive at the Net Annual Value (NAV). The NAV is the base figure on which further deductions are applied.
Standard Deduction — Section 24(a)
A standard deduction of 30% of the Net Annual Value is allowed under Section 24(a). This deduction is available for all let-out properties and covers expenses on repairs, maintenance, insurance, and other upkeep costs. The key advantage is that this deduction is automatic — you do not need to provide any proof of actual expenses. Whether you spent ₹5,000 or ₹50,000 on repairs, the 30% deduction applies uniformly.
Home Loan Interest Deduction — Section 24(b)
If you have taken a home loan for the property, the interest paid on the loan is deductible under Section 24(b). For a let-out property, there is no upper limit on the interest deduction — you can claim the full interest amount. However, for a self-occupied property, the maximum deduction is capped at ₹2,00,000 per year. This deduction is available only for the interest component of the EMI, not the principal repayment.
Airbnb and Short-Term Rental Income
With the rise of Airbnb and other short-term rental platforms in India, many property owners earn rental income through these platforms. This income is also taxable under "Income from House Property." The same deductions (standard deduction and home loan interest) apply. Additionally, you may need to register for GST if your turnover exceeds ₹20 lakh, as short-term accommodation services attract GST at 12%.
Loss from House Property
If your deductions (standard deduction + home loan interest) exceed the rental income, the result is a loss from house property. This loss can be set off against other income (like salary or business income) up to a maximum of ₹2,00,000 per year under the old tax regime. Any unabsorbed loss can be carried forward for up to 8 assessment years and set off against future house property income.
How to Use This Calculator
- Enter Annual Rental Income — Total rent received in the financial year.
- Enter Municipal/Property Tax — Property tax paid to the local municipal authority.
- Enter Home Loan Interest — Total interest paid on home loan during the year.
- Enter Other Deductions — Any other applicable deductions (if any).
- Select Property Type — Choose "Let Out" if rented or "Self-Occupied" if you live in it.
- Click Calculate — View NAV, deductions, and taxable rental income.