Deduction u/s 24(b) of the income tax act 1961

This query is : Resolved

Rahul Shelke (Querist)
Follow

10 March 2011 Hello Experts,

I am working in company as accounts officer.

Our employees have submitted the provisional interest certificate for the housing loan obtained from the financial institutions for the F.Y. 2010-11.

Now my queries are:
1. Can the employees claim the deduction u/s 24(b)of hosing loan interest, even if they have actually not paid any EMI. That is can they claim deduction on accrual basis.

2. If yes, then the provisional interest certificate will suffice as a documentary proof for claiming the deduction.

Please reply at the earliest.

Thank you.

- Rahul

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
Follow

10 March 2011 1.Yes, can be claimed on accrual basis.
2. Yes, provisional certificate can be considered for TDS purposes.

Rajan Kapoor

Rajan Kapoor (Expert)
Follow

10 March 2011 The interest is deductible on ‘payable’ basis i.e. on accrual basis. Hence it should be claimed on yearly basis even if no payment has been made during the year.

Provisional interest certificate is sufficient documentary proof for claiming the deduction.

For more information refer:
http://www.simpletaxindia.org/p/income-from-house-property-income-tax.html

Upgrade to CAclubindia Pro. Subscribe Now!