Carry forward of Losses from house property

Carry forward of losses:

After making the appropriate and permissible intra-head and inter-head adjustments, there could still be unadjusted losses. These unadjusted losses can be carried forward to future years for adjustments against income of these years. The rules as regards carry forward differ slightly for different heads of income.

Losses from house property:
  • Can be carry forward up to next 8 assessment years from the assessment year in which the loss was incurred
  • Can be adjusted only against Income from house property
  • Can be carried forward even if the return of income for the loss year is belatedly filed.
Extract From Income Tax Act:-
Section 71B of the Income Tax Act: Carry forward and set off of loss from house property:

Where for any assessment year the net result of computation under the head “Income from house property” is a loss to the assessee and such loss cannot be or is not wholly set off against income from any other head of income in accordance with the provisions of section 71, so much of the loss as has not been so set-off or where he has no income under any other head, the whole loss shall, subject to the other provisions of this Chapter, be carried forward to the following assessment year and—

 (i)  be set off against the income from house property assessable for that assessment year; and

(ii)  the loss, if any, which has not been set off wholly, the amount of loss not so set off,

shall be carried forward to the following assessment year, not being more than eight assessment years immediately succeeding the assessment year for which the loss was first computed.