House-property loss is one of the most misunderstood old-vs-new regime variables. A taxpayer may focus only on slabs and deductions, but the ability to set off home-loan interest loss can materially change the answer for homeowners and landlords.
The Income Tax Department house-property guidance states that loss under the house-property head up to ₹2,00,000 can be set off against other heads of income and unabsorbed loss can be carried forward for 8 years. The same official page also states that where the taxpayer opts for the default regime under section 115BAC, total income is computed without allowing house-property loss to be set off against income from other heads.
| Taxpayer profile | Old regime impact | New regime impact |
|---|---|---|
| Self-occupied house with home-loan interest loss | Set-off may reduce salary/other income subject to limits. | Cross-head set-off restriction must be considered. |
| Let-out property with high interest cost | House-property computation may create loss/carry-forward. | Check regime-specific set-off restriction and carry-forward treatment. |
| No home loan / no property loss | Regime decision may depend more on slabs and deductions. | House-property loss is not a key driver. |
Do not choose the new regime from payroll declaration alone if you have house-property loss. Run a full-year computation with home-loan interest, rent, municipal taxes, deductions and TDS before final filing.
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