New Property Tax Rules in 2025
What Homeowners Need to Know
Introduction
Big Changes for Homeowners in 2025
The Indian
government has introduced major updates to property tax rules in 2025
under the Income Tax Act, 2025, effective from 1 April 2025.
These changes impact homeowners, landlords, and real estate investors,
with benefits like zero notional rent on second homes, higher TDS
thresholds on rent, and clearer rules for deductions and annual value.
Whether you
own one home or many, this guide breaks down what’s new and how it affects your
tax filing in FY 2025-26.
🏘️ 1. Two Self-Occupied Homes Now
Allowed
Old Rule:
Only one property could be treated as self-occupied. A second vacant property
attracted notional rent tax.
New Rule
(from FY 2025-26):
You can now declare up to two properties as self-occupied, with no
notional rent applicable. Their annual value will be considered zero,
reducing your overall tax liability.
“no notional rent on second house
2025”
“self-occupied house property income tax
2025”
🚫 2. Notional Rent Removed for Second
Home
Previously,
if you owned more than one property and kept the second vacant, the tax
department assumed you earned rent (called notional rent), and taxed it.
➤ What's new in 2025:
✅ Great news for people with
second homes used for parents, vacation, or business stays.
🧾 3. Higher TDS Limit on Rental Income
Old TDS
Rule:
Rent above ₹2.4 lakh/year attracted TDS @ 5% under Section
194-IB.
Updated
for 2025:
TDS threshold increased to ₹6 lakh/year. This means:
SEO
Keywords:
✅ “tds on rent 2025 limit india”
✅ “rent income tax tds changes 2025”
🏠 4. Clarified Deductions for Interest
and Maintenance
You can
continue to claim the following:
🧠 Remember: Keep proper documents —
interest certificates, possession dates, municipal tax receipts.
📉 5. Simplified Rules for “Annual
Value” Calculation
The “annual
value” of a house determines how much rental income you are taxed on.
Budget
2025 Changes:
🧮 6. Revised Tax Slabs & Rebate
(Impacting House Property Income)
Section
87A rebate increased:
New tax
slabs apply,
indirectly affecting your total income from house property, especially
if rent pushes you into the next bracket.
🧱 7. Who Benefits from the 2025
Property Tax Reforms?
⚠️ What Hasn’t Changed in 2025
📌 Final Thoughts: Plan Better with the
New Property Tax Rules in 2025
These new
house property income tax rules offer relief and clarity, especially for
middle-class homeowners, senior citizens with inherited properties, and
salaried individuals with housing investments.
If you own
multiple homes or earn rental income, 2025 is a great year to restructure
your portfolio and tax strategy.
🔍 Frequently Asked Questions (FAQs)
✅ Can I now claim two self-occupied
homes in my ITR?
Yes, from FY
2025-26 onwards.
✅ Is notional rent applicable to a
second home?
No, it has
been removed from April 1, 2025.
✅ What is the new TDS threshold on
rent in 2025?
₹6 lakh
annually or
₹50,000/month.
✅ Do these rules apply to properties
under construction?
Yes, but
interest deduction begins only after possession or completion.
📢 Stay Updated
📌 Bookmark this blog for the latest property
tax updates 2025 India, and follow us for expert tips on real estate
taxation, rental income, and home loan deductions.
