House Loan Tax Deductions for Rented out Property

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  1. Swati_A

    Swati_A New Member

    Hi, I am planning to buy a house with a loan amount of 40lkhs for the sole purpose of investment. I am staying in another city and may rent out the property after possession, but definitely won't be the end user for it. It's my first property and the possession will be granted by the end of Year 2016. will I be able to claim tax benefits on loan and interest amount from FY 2015 and to what extent?
  2. Yes you can avail two types of deduction -
    1) For Principal Amount you can claim deduction u/s 80C maximum upto 150000. ( this is inclusive of LIC , Tution fees , PF etc)

    2) For interest paid you can claim deduction u/s 24(b) without any limit if you have let out that property .
    But if it is self occupied then you can claim deduction upto Rs.200000 u/s 24 (b).
    all the deduction can be availed after possession .
    however interest paid prior to possession can also be claim in 5 Equal installment in next five year of possession.
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