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Section 38(1)

Premises partly used for Business Partly for Dwelling House by Assessee

In this case AO will determine the proportionate amount of

  1. Annual Value
  2. Repairs
  3. Municipal Taxes

Used for the purpose of Business and Profession

Deduction is available in Section 30 of only that proportionate amount.

 

Note:-

AO will determine proportionate amount

 

How does AO Determine Proportionate amount?

S.NoExpense NameDeduction Allowed toHow does AO determine Proportionate Amount
1RentTenantAO will determine proportionate annual value (Annual value of property used in business/total annual value)
2RepairTenant/LandlordAmount as determined by AO
3Insurance PremiumTenant/Landlordn/a
4Municipal TaxesTenant/LandlordAO will determine Proportionate value on basis of area

Section 38(2)

 

Similaly if any building, machinery, plant or furniture is not exclusively used for the purposes of the business or profession,

thenAO will determine the proportionate amount which is used for the purpose of Business and Profession Deduction is available in Section 31 and 32 of only that proportionate amount.

 

 

  1. Income Tax
  2. PGBP Income
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CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 6 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com.
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