Section 28
Section 28: rent, rates, taxes, repairs and insurance
Section 28 allows a business or profession to deduct the routine running costs of the premises and equipment it uses - insurance, local taxes, rent (if it's a tenant), and current repairs - while computing business/professional income, with the deduction proportionately restricted where the asset isn't used wholly for the business.
This explanation is AI-assisted and pending review by our CA/CS team. It is general information, not professional advice - always cross-check against the bare law text above or talk to our tax team for guidance specific to your situation.
What is deductible
In respect of premises, machinery, plant or furniture used for the business or profession, the following are deductible (section 28(1)):
- Insurance premium against risk of damage or destruction of the premises/machinery/plant/furniture
- Land revenue, local rates or municipal taxes paid
- Rent paid, where the premises are occupied by the assessee as a tenant
- Cost of current repairs to the premises (not capital in nature), where the assessee occupies them otherwise than as a tenant
- Cost of repairs to the premises (not capital in nature), where the assessee occupies them as a tenant and has undertaken to bear repair costs
- Cost of current repairs to machinery, plant or furniture (not capital in nature)
Proportionate restriction for partial business use
Where the premises, building, machinery, plant or furniture is only partly used, or not wholly and exclusively used, for the business or profession, the deduction is restricted to the fair proportionate part as determined by the Assessing Officer, having regard to the extent of business use (section 28(2)).
Frequently asked questions
Can I deduct rent I pay for my office or shop?
Yes - if you occupy the premises as a tenant, the rent paid is deductible under Section 28(1)(c).
Are capital repairs (like a major renovation) deductible under this section?
No - only current repairs, not capital expenditure, are deductible under this section.
What if I use part of my house for business and part for personal living?
The deduction is restricted to a fair proportion attributable to business use, as determined by the Assessing Officer, under Section 28(2).
Related sections
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Talk to our tax team about this sectionLast updated 9 September 2026