Income Tax on House Property
Under Section 24 of the Income Tax Act, tax is imposed on income from house property. This encompasses various types of properties including houses, flats, offices, shops, and any associated structures. The categorization of these properties as either residential or commercial is irrelevant—the deciding factor is the income produced and under which specific income head it is charged.
To be taxed under 'Income from House Property', certain criteria must be satisfied:

1. The person, i.e., the assessee, must own the property.
2. The property in question should include buildings or adjacent land owned by the assessee.
3. The property must not be utilized for business or professional uses, otherwise, it will fall under 'Income from Business and Profession'.

Calculating Income from House Property
There are distinct classifications for assessing income from house property:

1. Self-Occupied House Property: Refers to properties utilized by the owner for personal residence. Taxpayers can declare a maximum of two such properties for a fiscal year; any additional properties are considered 'deemed to be let out' and can lead to expenses like loan interest.
2. Let Out House Property: When a property generates rental income, it is taxed individually under 'Income from House Property'. The owner can deduct expenses and loan interest.
3. Deemed Let-Out House Property: If an owner has more than two self-occupied properties, any extra ones are automatically categorized as deemed let out. Tax implications remain the same as if they were rented.

The method involves computing the Gross Annual Value, subtracting Municipal Taxes, deriving the Net Annual Value, and then applying deductions like Standard Deduction and Interest on Borrowed Capital. Taxpayers can avail of deductions for Municipal Taxes, applicable Standard Deduction, and Home Loan Interest, which varies for let-out and self-occupied properties based on specific rules. Additionally, claims for Pre-Construction Interest are permissible under certain conditions. Home Loan Interest can also be deducted under Section 80EE given certain criteria are satisfied.
If a loss from house property occurs, it can be adjusted against other incomes up to Rs. 2 lakh per assessment year. Any remaining loss can be carried forward for up to eight years. Understanding the tax repercussions of house property income is vital for minimizing tax liabilities by making full use of applicable deductions.