Home Loan Benefit under Section 24 on 2nd home

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  1. Ganesh S

    Ganesh S New Member

    Hi

    I own an apartment which has been rented out for the past one year. I am the sole owner of this house, and there are no outstanding home loans on this property.

    I have now purchased another fully constructed apartment under a joint home loan with my wife, with my wife being the first applicant and me being the second applicant. This is the first house property for my wife.

    I understand that the deduction under Section 24 for my wife will be limited to 2 Lacs per annum. However, I would like to know what the limit would be for me under Section 24. Would this house be considered as a second house for me? Can I get deduction under Section 24 without the limit of 2 Lacs in such cases?

    Many Thanks in Advance
    Ganesh
     
  2. gaurav_kumar

    gaurav_kumar Well-Known Member

    The limit of Rs. 2 Lakhs is for Self-occupied property.

    For non self occupied property - there is no limit for deduction which can be claimed.

    PS: A person is only allowed to show 1 property as Self Occupied and all other properties would be treated as Let out/ Deemed Let out.
     
  3. Ganesh S

    Ganesh S New Member

    Thanks, Gaurav.

    So, in my case, can I declare my first property (which is rented out) as self occupied, add the rental income from first property under "Income from house property" section, and claim maximum deduction under Section 24 (where I am co-owner, so 50% of total annual interest) on second property?

    Also, when I asked my CA, he was of the opinion that only 2 Lacs can be the deduction under Section 24 in my case. However, I have come across numerous articles that mention what you did - that deduction of home loan interest outgo for non-self occupied property is unlimited. Does being a co-owner in second property have any impact on this? Can you point me to the right clause / section in the IT Act that allows this unlimited deduction?
     
  4. Manoj Mehra

    Manoj Mehra Active Member

    1. There is no limit on max deduction for the first property which is let out.
    2. There is a max limit of Rs. 2 Lakhs for the 2nd property. Contact any CA in your vicinity and he'll guide you. You can get contact no.'s of CA's in your vicinity on Just Dial.
     
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