If you own a warehouse and earn rent from it, the government will tax that income. Here is a straightforward explanation of how it works.
Section 22 — The Basic Rule
Under the Income Tax Act, rental income from any building (including warehouses and godowns) is taxed under “Income from House Property” as per Section 22.
This applies when you rent out your warehouse to someone else. If you use the warehouse in your own business, the rules are different — it falls under business income instead.
How the Tax Is Calculated
The calculation works in three steps:
Step 1: Calculate Gross Annual Value — this is the actual rent you receive in a year.
Step 2: Deduct municipal taxes paid — subtract the property tax you paid to the local body.
Step 3: Deduct 30% as Standard Deduction under Section 24(a) — this covers all maintenance and repair costs. No bills needed.
If you have a loan on the warehouse, you can also deduct the interest paid under Section 24(b) without any upper limit.
Example:
- Annual rent: ₹5,00,000
- Less municipal tax: ₹15,000
- NAV: ₹4,85,000
- Less 30% standard deduction: ₹1,45,500
- Taxable income: ₹3,39,500
This amount is added to your other income and taxed at your applicable slab rate.
TDS on Warehouse Rent
If your tenant is a company or an audit-liable business, they must deduct TDS at 10% under Section 194-I if annual rent exceeds ₹2,40,000. You can claim this TDS when filing your return.
GST Is Separate
GST on commercial warehouse rental is 18%. If your annual rent crosses ₹20 Lakhs, GST registration is required. GST collected from tenant is deposited with the government — it is not your income.
Looking for a Warehouse in Lucknow?
Speaking of warehouses — if you are looking for a space to rent in Lucknow, Ashoka Warehousing on Sitapur Road NH-24 offers a 28,896 sq. ft. complex with units starting at 1,700 sq. ft. at just ₹18 per sq. ft. This rate is negotiable and works out to around ₹30,600 per month — very fair for a newly built highway warehouse.
The NH-24 location beats alternatives like Transportnagar or Chinhat because it offers direct truck access, zero city traffic, and great connectivity to Delhi and north UP markets.
Why Ashoka Warehousing Is the Best Choice for Your Business
Ashoka Warehousing offers newly built warehouse space on NH-24 Sitapur Road at ₹18 per sq. ft. — one of the lowest rates in the city. With a large complex, negotiable pricing, and a highway location, it is built for businesses that value speed and cost savings. From small distributors to large logistics companies, Ashoka Warehousing is one of Lucknow’s most practical warehousing options.
FAQ
- Is warehouse rental income taxable?
Yes, under Section 22 as income from house property. - What deduction can I claim on warehouse rental?
30% flat standard deduction under Section 24(a), municipal taxes, and loan interest under Section 24(b). - Is TDS applicable on warehouse rent?
Yes, at 10% under Section 194-I if annual rent exceeds ₹2,40,000.
4. Where can I find cheap warehouse rent in Lucknow?
Ashoka Warehousing on NH-24 Sitapur Road offers ₹18/sq. ft., negotiable.