While presenting the general budget, Finance Minister Nirmala Sitharaman announced several measures aimed at benefiting taxpayers directly. One of the most significant announcements relates to homeownership. She stated that taxpayers could now declare the annual value of two self-occupied properties as zero without any preconditions.
No Conditions for Declaring Two Properties’ Annual Value as Zero
During her budget speech, Sitharaman emphasized that currently, taxpayers are required to fulfill certain conditions to claim the annual value of self-occupied properties as zero. Recognizing the challenges faced by taxpayers, she proposed granting this benefit for two self-occupied properties unconditionally.
Proposed Amendments to Income Tax Act
The government has suggested an amendment to sub-section 2 of Section 23 of the Income Tax Act, which determines the annual value of residential properties. According to the budget document, subsection (2) specifies that if a house is occupied by the owner for self-residence or if the owner is residing elsewhere due to employment, business, or profession, then the annual value of such property is considered zero. The proposed amendment extends this provision to two properties without restrictions.
Increased TDS Limit on Rent
Another significant proposal in the budget is the increase in the annual limit of TDS (Tax Deduction at Source) on rent from the existing Rs 2.4 lakh to Rs 6 lakh. Finance Minister Sitharaman stated in her speech that this move aims to streamline tax deductions by adjusting TDS rates and limits, ensuring better clarity and uniformity in tax application.
She further mentioned that this revision in the TDS limit would provide substantial relief to tenants and landlords alike, allowing for a more transparent taxation process.
Conclusion
The recent budget announcements reflect the government’s intent to ease the financial burden on taxpayers, particularly homeowners and tenants. By eliminating conditions on self-occupied property valuations and raising the TDS threshold on rent, the new proposals are expected to provide significant tax relief and promote better compliance.