Tax Benefit on Interest on Home Loan

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  1. alwayswithamit

    alwayswithamit New Member

    Dear Sir,

    I have booked a under construction Flat in December'2010 and started home loan by paying Full EMI since start. However, possession is still pending and it has been about 6 years since booking of Flat. I am in Govt. Job.
    How can I claim for Tax Benefit in ITR on account of Interest on Home/Housing Loan. Please elaborate. Moreover, can I claim Tax Benefit for previous years as well against similar case.

  2. ZED

    ZED Well-Known Member

    Since the possession has not been granted to you, it is advisable to not to claim any deduction on account of interest.

    It does not mean that that periods interest is gone. The pre construction period interest will be available to you in 5 equal installments from the year in which you received the possession.
  3. alwayswithamit

    alwayswithamit New Member

    Thanks for the prompt reply. You may please cite any example/derivation for later claim of Tax Benefit on account of Housing/Home Loan Interest.

  4. ZED

    ZED Well-Known Member

    Explanation to S.24—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:

    So if pre construction period was 1 Lac
    Then 20k can be claimed as deduction each year
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