How do I compute the Gross Annual Value (GAV) of a property that was vacant for part of the year? – TaxArithm

If the property was not at all rented out during the year and the person does not own more than 2 house properties, then such property can be treated as "Self-occupied Property" and hence the Gross Annual Value (GAV) of the property will be NIL.

Otherwise, it will be treated as "Let-out Property" or "Deemed Let-out Property" and its Gross Annual Value (GAV) will be calculated as if the property was rented out for the entire year.

The computation of Gross Annual Value (GAV) in such a case is computed in the following manner:

If the property was Rented out for part of the year

Rent as per municipal valuation (A)
Fair amount of Rent (B)

Consider Amount higher of (A) & (B) (C)

Standard Rent* as per The Rent Control Act (D)

Expected Rent = Lower of (C) and (D)

If Actual Rent Received (+) Notional rent** for Vacancy Period > Expected Rent
then, GAV = Actual Rent Received
If Actual Rent Received (+) Notional rent** for Vacancy Period < Expected Rent
then, GAV = Expected Rent for entire year

If the property was not Rented out at all during the year

Rent as per municipal valuation (A)
Fair amount of Rent (B)

Consider Amount higher of (A) & (B) (C)

Standard Rent* as per The Rent Control Act (D)

Expected Rent = Lower of (C) and (D)

GAV = Expected Rent for entire year

*If the property is not governed by The Rent Control Act, then ignore the step of comparing Standard Rent, and hence the Expected Rent will be higher of (A) & (B).

**Notional Rent means rent amount that would have been received if the property was not vacant.

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