In the past few years, Kochi has been witnessing unprecedented growth in the property sector fueled by the increased business investments in various sectors. Real estate development in the city and the state of Kerala is growing at a fast rate in these recent years.
All segments of real estate industry like corporate, retail and residential have been part of this growth. However, as always the investment and growth in residential property is the greatest with approximately 70-80% growth of this sector. Of these, high-rise Kochi apartments are more popular than other categories of residential properties.
Like any other areas of development or investment, Non-resident Indians (NRIs) are one of the major players in real estate sector. With the increased potential for greater profit, and liberalized rules of capital gains and repartition of the same it is hoed that they will step-up their investment in future.
The income tax on residential apartment income would be dependent on whether the property is vacant or rented out. In case an NRI has only one property in India that is vacant, then there is no rental value for such property. However, if he owns two property and both of them are kept vacant, then he is required to pay income tax on one of the properties as if the property had been let out.
In case of let out properties, the actual rental income less the municipal taxes is subject to tax. Certain deductions on these are also allowed.