28 January 2011
I purchased on house before last 6 month which is under construction & i took the loan from bank for the same. My EMI was started. Bank charges interest amount. Shall i get the benefit of full interest amount as per the certificate given by bank fro this year i.e. April 2010 To March 2011. Pls guide. I am not getting the possession of house.
28 January 2011
You can not claim any income tax benefit on this pre-EMI interest in the year you pay it to the bank.
Pre-EMI interest can be claimed in 5 equal instalments after the construction of the house ends. That is, it can be claimed in 5 equal instalments starting from the FY in which the construction of the house ends and you get its possession.
This pre-EMI interest should be claimed along with the interest component of the EMI under section 24. The overall limit remains Rs. 1.5 Lakhs even in this case.
CAclubindia
