Hi all,
I have some queries related to housing loan exemptions. Please clarify the following questions as it would help me gain a clear understanding of tax implications:
1. If a person has taken a housing loan for a property that is not yet occupied, how should we consider the housing loan interest for tax purposes? How many years of housing loan interest payments can be considered for exemptions if the property has not been occupied due to ongoing construction?
2. Once the person occupies their own house, how should we calculate their housing loan interest for tax exemptions? How many years of housing loan interest should be considered for exemption?
With Regards,
Vasanth
From India, Madras
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I have some queries related to housing loan exemptions. Please clarify the following questions as it would help me gain a clear understanding of tax implications:
1. If a person has taken a housing loan for a property that is not yet occupied, how should we consider the housing loan interest for tax purposes? How many years of housing loan interest payments can be considered for exemptions if the property has not been occupied due to ongoing construction?
2. Once the person occupies their own house, how should we calculate their housing loan interest for tax exemptions? How many years of housing loan interest should be considered for exemption?
With Regards,
Vasanth
From India, Madras
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Dear Vasanth,
Interest on Housing Loan paid/payable during the year is deductible under section 24 from the income from House Property. Briefly, your query can be solved as below:
If the house is not constructed fully, interest on the loan up to the year of construction (excluding the year of construction) cannot be deducted now. It will be deductible after completion of construction in five installments beginning from the year in which it got completed.
If the house is fully constructed, the entire interest is deductible if it is let out, and interest up to 1.5 lacs per annum is deductible if it is self-occupied. Interest of the pre-construction period is also deductible in five installments in the post-construction period.
Rajiv
From India, Gurgaon
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3Interest on Housing Loan paid/payable during the year is deductible under section 24 from the income from House Property. Briefly, your query can be solved as below:
If the house is not constructed fully, interest on the loan up to the year of construction (excluding the year of construction) cannot be deducted now. It will be deductible after completion of construction in five installments beginning from the year in which it got completed.
If the house is fully constructed, the entire interest is deductible if it is let out, and interest up to 1.5 lacs per annum is deductible if it is self-occupied. Interest of the pre-construction period is also deductible in five installments in the post-construction period.
Rajiv
From India, Gurgaon
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Vasant
Self-Occupied Property
The Assessee will get exemption towards interest paid on house property.
If the property purchased before 01/04/1999– Exemption will be given up to tune of Rs.30,000/- towards interest on House property.
If the property is purchased on or after 01/01/1999– Exemption will be given up to tune of Rs.1, 50,000/- towards interest on House property.
If the employee fulfilled the following conditions then he is eligible to claim house property as well as House rent exemption benefits.
Due to his profession if the employee is not in a position to occupy his self-occupied property.
Both House property as well as rented property situated in different places i.e different cities.
If the assessee hasn’t derived any rental income from the rental property
From India, Hyderabad
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Self-Occupied Property
The Assessee will get exemption towards interest paid on house property.
If the property purchased before 01/04/1999– Exemption will be given up to tune of Rs.30,000/- towards interest on House property.
If the property is purchased on or after 01/01/1999– Exemption will be given up to tune of Rs.1, 50,000/- towards interest on House property.
If the employee fulfilled the following conditions then he is eligible to claim house property as well as House rent exemption benefits.
Due to his profession if the employee is not in a position to occupy his self-occupied property.
Both House property as well as rented property situated in different places i.e different cities.
If the assessee hasn’t derived any rental income from the rental property
From India, Hyderabad
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Dear Pon Sorry to disagree, But I believe that the limit of 1.5 lacs is applicable only in case of Self occupied Property. Rajiv
From India, Gurgaon
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From India, Gurgaon
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Dear Mr.Vasanth, I hope the attached notes will be some help to U. Regards, kumar.s.
From India, Bangalore
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From India, Bangalore
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Hello Loginmiracle,
I just went through the attachment you posted last year, where it is mentioned about taking a joint loan by a couple, for which the tax benefit is calculated with 70% paid by the husband and 30% paid by the wife. Is there any rule for this percentage, or can this be decided by the couple? Please clarify.
Other seniors can also help me. I am about to take a joint loan.
From India, Madras
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I just went through the attachment you posted last year, where it is mentioned about taking a joint loan by a couple, for which the tax benefit is calculated with 70% paid by the husband and 30% paid by the wife. Is there any rule for this percentage, or can this be decided by the couple? Please clarify.
Other seniors can also help me. I am about to take a joint loan.
From India, Madras
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Sir,
I browsed through your notes and I have one doubt regarding the interest paid for the pre-construction period, i.e., pre-EMI. When the exemption is claimed after construction, the ceiling amount is 1.5 lakhs for the interest part for a self-occupied house. Does this ceiling include the 20% share of pre-EMI, or is the 20% share of pre-EMI exempted over and above the 1.5 lakhs, since that amount was actually paid during a different financial year?
Regards,
SURY6695
From India, Bangalore
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I browsed through your notes and I have one doubt regarding the interest paid for the pre-construction period, i.e., pre-EMI. When the exemption is claimed after construction, the ceiling amount is 1.5 lakhs for the interest part for a self-occupied house. Does this ceiling include the 20% share of pre-EMI, or is the 20% share of pre-EMI exempted over and above the 1.5 lakhs, since that amount was actually paid during a different financial year?
Regards,
SURY6695
From India, Bangalore
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Dear Mr. Pon,
The subject provided interesting reading. I agree with Mr. Rajiv Chawla regarding the 1.5 lakhs ceiling for self-occupied houses. Home loan interest for houses rented out is eligible for exemption to the tune of the sum paid towards the interest part of the loan repayment.
Regards,
SURY6695
From India, Bangalore
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The subject provided interesting reading. I agree with Mr. Rajiv Chawla regarding the 1.5 lakhs ceiling for self-occupied houses. Home loan interest for houses rented out is eligible for exemption to the tune of the sum paid towards the interest part of the loan repayment.
Regards,
SURY6695
From India, Bangalore
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