Regarding Interest benefit on Housing loan repayment

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  1. Kapil2709

    Kapil2709 New Member

    Dear All,

    I have 2 flats. 1st one I rented out and getting rent so i claim the complete interest part which I paid to bank. For 2nd one I got possession in Dec 2015 before that I paid interest since Oct 2012.. So how much interest in total I can claim in 2015-16 ITR.. Secondly I have submitted and e-verified the ITR so can I modify the ITR now.. Plz revert
  2. ZED

    ZED Well-Known Member

    Since you mentioned that you claimed deduction in respect of first property already , I am providing info in respect of 2nd property.

    Whatever was the interest amount since Oct 12 till Dec 15
    Accumulate this interest, let it be 100 Rs
    Now, you can claim deduction of the pre construction period in 5 equal installments starting from F.Y 15-16

    Therefore, for this F.Y claim 20Rs in relation to pre acqusition period and the normal interest (post acquisition period) from Dec onwards.

    Kindly note the interest deduction shall not be unlimited if the property is self occupied.

    I am citing relevant provision for your reference.

    (b) where the property has been acquired, constructed, repaired, renewed or reconstructed with borrowed capital, the amount of any interest payable on such capital:

    Provided that in respect of property referred to in sub-section (2) of section 23, the amount of deduction shall not exceed thirty thousand rupees :

    Provided further that where the property referred to in the first proviso is acquired or constructed with capital borrowed on or after the 1st day of April, 1999 and such acquisition or construction is completed within three years from the end of the financial year in which capital was borrowed, the amount of deduction under this clause shall not exceed two lakh rupees.

    Explanation.—Where the property has been acquired or constructed with borrowed capital, the interest, if any, payable on such capital borrowed for the period prior to the previous year in which the property has been acquired or constructed, as reduced by any part thereof allowed as deduction under any other provision of this Act, shall be deducted under this clause in equal instalments for the said previous year and for each of the four immediately succeeding previous years:

    Provided also that no deduction shall be made under the second proviso unless the assessee furnishes a certificate, from the person to whom any interest is payable on the capital borrowed, specifying the amount of interest payable by the assessee for the purpose of such acquisition or construction of the property, or, conversion of the whole or any part of the capital borrowed which remains to be repaid as a new loan.
    Kapil2709 likes this.
  3. Kapil2709

    Kapil2709 New Member

    Thnks ZED for the information..
    I want to know that for 1st one I have paid 358000/- as a interest and for second one 328000/- as a interest last year which possession I got in Dec 2015 so in total how much interest part I can deduct.. It will be 358000/- plus 200000/- or more than that ???

    Secondly I paid approx 8 lac in 2012-13, 2013-14 and 2014-15 as a interest and in 2015-16 I got possession in Dec 2015 so how it will be calculated..

    Can I rectify the current ITR which I e verified 3 days back
  4. ZED

    ZED Well-Known Member

    In respect of let out property, there is no limit.
    We have to do separate calculation for let out , or deemed to be let out property , and separate calculation for self occupied or deemed to be self occupied property.

    For , first one claim full. For second do the computation as explained in previous post. [Aggregate the pre-construction period, divide it by 5 and claim the amount you got]
    For post construction period , add the amount of interest payable for this F.Y and not add this amount with the interest amount you got in previous one (pre construction period)
    and now apply the limit of 30,000 or 200,000 .

    30,000 if construction did not completed within 3 years

    You will have to file a revised return u/s 139(5).
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