House Property

This query is : Resolved

marimuthu (Querist)
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01 December 2008 Sir,

Mr.A having Own Property in his name and he is living in Mrs.A property and he pay rent to spouse and parents are living in his property. both the property in chennai. My query is Assume Mr.A employee, is he claiming of HRA and same time he is eligible interest and principal of bank loan in his property? please clarify?

K V Subba Rao

K V Subba Rao (Expert)
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01 December 2008 Mr A may make calcuations for two alternative scenarios and find out for himself whichever is advantageous

First Alternative:
(a) Treat his own property as not used for self occupation but let out to some one else. May be he can take rental value adopted by Municipal Corporation for Tax purpose as Rent realised. From the rental income, he can claim interest on bank loan u/s 24, Property Tax and Standard Deduction.

(b) Claim HRA exemption as per prescribed conditions by taking rent paid by him to his spouse. This is legally permitted, but to be on safe side, let Mr A deposit rent amount every month in his spouse's bank account (not joint).

Second Alternative:

(a) Treat own property as self occupied. This will also entitle him to claim interest (upto Rs 1.50 lacs)

(b) Don't claim any exemption for rent paid. Include entire amount of HRA received in total income.

It is better to make calculations with figures for both alternatives and then choose.

I also suggest to visit apnaloan.com in which you find answers to several FAQs on topics related to Income from House Property