How to File ITR-1 with Rental Income?

ITR-1 is the simplest of all the forms, designed for a simple income structure without business income or capital gains. Exempt capital gains under section 112A can still be filed under ITR-1. Therefore, if you have only rental income, you can file your taxes under ITR-1. 

What is Rental Income?

As per the provisions of the Income Tax Act, all the rental income derived from buildings are classified as ‘Income from House Property’. Unless the primary business of the assessee is renting out premises or movable assets, the rental income should be disclosed under the following heads:

Documents Required 

• Form-16 - if you have salary income apart from rental income.
• Form 26AS - Summary document containing all TDS deductions against your income
• PAN
• Details of other income - like bank statements for interest income.
• Name and PAN of the tenant.
• Rent receipts and rental agreement - for determination of rental income
• Property tax receipts - for claiming municipal tax deduction 
• Interest certificate on home loan paid - For claiming interest deduction against house property

Step-by-Step Guide on ITR-1 filing with Rental Income

1. Login to the Income Tax Portal, with your PAN as the login ID and set password.
2. Select the relevant assessment year. Please note that the relevant assessment year is the next year of the financial year. For example, if your filing ITR for FY 2025-26, the relevant assessment year is 2026-27.
3. Select the filing type - whether it is original return, revised return, belated return etc.
4. Choose online mode, since it is the easiest option for self-filing of ITR.
5. Enter your personal details, validate you bank account details and click next.
6. In Gross Total income section, you can validate the pre-filled details, and add any other income or exempt income, if any.
7. In the deduction section, depending on the tax regime chosen, you can claim the applicable deductions, and providing all the relevant details.
8. In the taxes paid section, all the taxes paid in the form of TDS and advance tax are displayed. If there is any additional tax due, you can pay while filing the return by clicking 'Pay Now' option. If taxes already paid is excess, you can claim refund.
9. After the declaration page in which you provide date, place and your status, you can proceed to validation.
10. In the validation stage, you will find any errors triggered during the filing process. After resolution of all the errors, you can submit the return and proceed to verification
11.  It is necessary to e-verify the return within 30 days of return filing. E-verification can be done by Aadhar OTP, digital signature, bank account EVC or net banking.

Steps to File ITR-1 with Rental Income using ClearTax

Altertatively, you can use ClearTax online platform to file your ITR with much ease and speed. Please refer to the following steps:

1. Login to your ClearTax account and click on ‘Start Filing’.
2. Fill in all your personal details like name, address and other details will appear here. You can expand each section and review these details. You also have the option to edit them, if required. 
3. Add the rental income by navigating to Income Source > Rental income or House property > Property you have given on rent. Consider to fill the below details
   1. Address of the property
   2. Co-ownership details such as Name, PAN and share of the co-owner
   3. Tenant Details such Name, PAN/TAN and Aadhaar. Here TAN is mandatory of the TDS is made by the tenant us 194-IB
   4. Fill in Rental income and property tax paid details.
   5. Fill in the interest on housing loan (pre-construction and post construction component separately).
4. Fill in the other details such as income from salary, capital gains, business, dividend, interest details, mention the deductions details, taxes paid. 
5. Once you update with all the documents. Proceed to Tax Summary page to View Summary, Compare, and Switch Tax Regimes and confirm the details. You can also view and download your tax report.
6. To proceed, click on ‘File tax’. Check the box and ‘Submit Declaration’. After your return is submitted, e-verify your return to complete the filing process. If the ITR is not e-verified within 30 days then it will be considered as invalid ITR. 

Final Word

Filing ITR for rental income is mandatory, since it is a taxable income. Overlooking vacant property in certain cases may also attract adverse consequences, as the concept of deemed let out property calculated notional rent and taxes the same. Proper claiming of deductions helps the taxpayers optimize their tax outflow.