06 June 2013
Hi i constructed a house. I want to know how to claim Interest on housing loan. Initially interest was being paid, later emi started and there is Principal and interest portion in it . What is the treatment for the above, i heard that there is some difference. Kindly help!! Further my wife contributed towards construction of the house by selling a land in her name. in return i gave her 10% share in the property.While filing return this year is she required to show anything under house property in return as everything is nil. And in my return should i specify that i hold 90% ownership in the property?. Thanks in advance
06 June 2013
Deductions from income from house property. Income chargeable under the head "Income from house property" shall be computed after making the following deductions, namely:- (a) a sum equal to thirty per cent. of the annual value; (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 one lakh fifty thousand 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. The following third proviso and Explanation shall be inserted after the second proviso to section 24 by the Finance Act, 2002, w.e.f. 1-4-2003: 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. Explanation.-For the purposes of this proviso, the expression “new loan” means the whole or any part of a loan taken by the assessee subsequent to capital borrowed, for the purpose of repayment of such capital.
Read more at: https://www.caclubindia.com/forum/interest-deduction-under-section-24-it-act-131843.asp
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