05 July 2016
I have opted Personal Loan from HDFC Bank and Home Loan from LIC for my first home construction in FY 16. I am aware that I can show the Interest deducted from Home Loan under Section 24(b), similarly can I show the interest deducted from personal loan under section 24 (b). If yes, please let me know if I need to submit any supporting documents while submitting it. Thanks.
05 July 2016
I read it in a blog saying that " Section 24 - income tax benefit on interest on personal loan. You can claim income tax benefit on personal loan under this section, when the same is used for purchase of property, repaired, refurbished or renovated. Overall interest benefit is 1.5 lacs for tax exemption." Please clarify. Thanks.
05 July 2016
If the personal loan is utilized for home construction, 24(b) deduction can be claimed. No supporting document required while filing the return. Keep it and produce it when asked for.
05 July 2016
When asked for by the income tax department, you need to prove that the PERSONAL loan has been used to construct/purchase the house property. If you are able to do that, then you can do so. (Just a small addition, if you are a salaried employee, the employer MAY not consider the same for TDS purposes)
05 July 2016
Be sure that LIC home loan amount plus its margin is substantially lower than Cost outlay of home. So that you can establish that the balance amount towards construction was financed by proceeds of Person Loan.
05 July 2016
No matter even if the margin is FINANCED with personal loan......the only point could be Loan amount can NOT be greater than COST of house.
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