• Income from house property

I have one house with Loan amount of Rs 39 lakhs, against which I am taking interest deduction of Rs 200000. Now I have also book another flat in another city with loan amount of Rs 15 lakhs and the same is under construction.
In this regard you are requested kindly suggest how can i get interest payment benefit against the two property I have.

I am salaried.
Asked 4 years ago in Income Tax

hii

 

as per income tax act, 1961 you can take benefits of interest as well as principle after getting possession , thus under construction property intt and principle not eligible for deductions.  

Lalit Bansal
CA, Delhi
773 Answers
61 Consultations

5.0 on 5.0

Hi,

 

Unfortunately, income tax act does not allow deduction of interest in case of an underconstruction property. Thus, you can only claim interest deduction on your first property which is fully constructed.


 

Interest paid during the under construction period shall be available as deduction in 5 equal installments starting from the year of completion.

Lakshita Bhandari
CA, Mumbai
5687 Answers
908 Consultations

5.0 on 5.0

Second property is still under construction so you don't need to take benefit of interest of such house until it's constructed and you get possession.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

Naman Maloo
CA, Jaipur
4265 Answers
96 Consultations

5.0 on 5.0

Hello,

 

Interest from house property under construction is not allowed until the construction is complete. The pre-construction period interest would be allowed in 5 equal instalments after the construction is complete.

I hope that this answer satisfies your requirements.

 

Regards,

CA Hunny Badlani

Hunny Badlani
CA, Madhya Pradesh
2608 Answers
16 Consultations

5.0 on 5.0

Dear Sir,

 

Hope you are doing well !!

 

Deduction on home loan interest cannot be claimed when the house is under construction. This pre-construction interest can be claimed only after the construction is finished.

 

The interest for the period during which the house was under construction can be availed in five equal instalments after the construction is completed.

 

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

Hello Sir,

 

Tax deduction is allowed on the interest paid during construction but you can claim it only after you receive possession, 20% each year for 5 years from the year of possession.

 

In case you are self-occupying the property, you can claim deduction on interest repayment upto Rs. 2 lakhs per year.

 

In case the property is not self-occupied, you can claim tax rebate on the entire interest payment. The property will be deemed as rented out even if it is lying vacant.

 

 

Karishma Chhajer
CA, Jodhpur
2450 Answers
29 Consultations

5.0 on 5.0

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