The Union Budget 2025 has brought welcome news for landlords and tenants, with a significant increase in the threshold for TDS on rent. The annual limit has been raised from Rs 2.4 lakh earlier, a move expected to ease the tax burden and simplify rental transactions.
Following the update, the shares of realty stocks like Prestige Estates rose by 9.3% to their day’s high of Rs 1,489.95 on the BSE, followed by Sobha, surging by 4.6% to Rs 1,385.
The shares of Phoenix Mills, DLF, Oberoi Realty and Godrej Properties surged between 1-2%.
The adjustment means landlords will now only be required to deduct TDS on rental income exceeding Rs 6 lakh annually, a considerable increase from the previous limit.
This change is anticipated to reduce the administrative burden for both parties involved in rental agreements and lessen the immediate financial impact of TDS, making the rental market more efficient and accessible.Additionally, the taxpayers will be allowed to claim the annual value of two self-occupied properties as nil without any condition.This means that individual taxpayers in India will be able to declare the annual value of up to two properties they live in themselves (self-occupied properties) as zero for tax purposes, regardless of any other conditions. This effectively means they won’t have to pay any income tax on the imputed rental income from these two properties.
Also read: Budget 2025 Live Updates: Bihar shines brighter in Nirmala Sitharaman’s Budget 2025 – Gareeb, youth, annadata and naari also feature in FM’s speech
Additionally, the Finance Minister also exempted income tax for individuals earning up to Rs 12 lakh per annum, which may further boost consumption and result in inflows in the real estate market.
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