income from house property

The income earned by the assesse from a property is taxable under the head 'Income from House Property'. If an individual owns a house property, the rent received becomes taxable. This actual rent received or the notional rent is referred to as ‘annual value’ and taxable under Income Tax. However, there are several deductions allowed by the Income Tax Act, 1961 from such income from house property. Let us discuss them briefly.

Municipal Taxes:

Municipal tax is the annual amount paid to the municipal corporation of that area. Municipal taxes are to be deducted from the Gross Annual value to derive the Net annual value of the house property.
Deduction of municipal tax is allowed only if it has been borne by the owner and paid during that financial year.



Various Forms under Employees Provident Fund

EPFO is one of the world's largest Social Security Organisations in terms of clientele and the volume of financial transactions undertaken. At present it maintains 19.34 crore accounts pertaining to its members.

The Employees' Provident Fund came into existence with the promulgation of the Employees' Provident Funds Ordinance on the 15th November, 1951. It was replaced by the Employees' Provident Funds Act, 1952. The Employees' Provident Funds Bill was introduced in the Parliament as Bill Number 15 of the year 1952 as a Bill to provide for the institution of provident funds for employees in factories and other establishments. The Act is now referred as the Employees' Provident Funds &


TDS Contractor

Section 194C of the Income Tax Act, 1961 deals with the provisions related to deduction of TDS at the time of payment to contractors/sub-contractors. According to this section any person making payment to the resident contractor (or subcontractor) for carrying out any contract (including the supply of labor) is required to deduct tax on such payment.


TDS on Salary under the Income Tax Act 1961

A salary is a form of payment from an employer to an employee, which may be specified in an employment contract. Salary is a fixed amount of money or compensation paid to an employee by an employer in return for work performed. Salary is commonly paid in fixed intervals, for example, monthly payments.

Salary in common parlance means any amount paid by an employer to his employees in lieu of services rendered by them. However, the Income Tax Act, 1961 defines the term “salary” u/s 17(1) to include the following monetary as well as non-monetary payments.



A provident fund is a government-managed, mandatory retirement savings scheme. It is managed by the Employee Provident Fund Organization. These funds also share some characteristics with pension funds provided by employers.

The purpose of Provident Fund is to provide employees with lump sum payments at the time of exit from their place of employment. This differs from pension funds, which have elements of both lump sum as well as monthly pension payments. 


Non Deduction of TDS on Interest Income

It is common for many of us to have a fixed deposit in banks which earns some fixed amount of Interest. However, if the interest earned on such investment is higher than certain threshold limit, it is subject to Tax Deducted at Source. TDS on Interest income from such fixed deposits is governed under Section 194A of Income Tax Act, 1961. TDS on Interest income is applicable at the rate of 10% if amount of interest in a financial year exceeds Rs. 40,000 (prior to FY 2019-20, the limit was Rs 10,000). Banks are liable to make such deductions. These deductions take place at the time when the interest is paid by the financial institution to its customers.

Financial Management