Housing loan interest and preconstruction period interest

This query is : Open

Prashant (Querist)
Follow

07 August 2017 I am joint owner in two properties. One property where I am joint owner with my brother and in another I am joint owner with my wife. In the second case, we bought the under construction property and we got the possession in Feb 17. I have a preconstruction period interest for FY 14-15 and FY 15-16. In the 2017 budget, the interest on loan is restricted to 2 lakhs. I want to know whether I can claim preconstruction period interest over and above 2 Lakhs. I can show the second house as deemed to be let out

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)
Follow

07 August 2017 Preconstruction period , as you would be aware, is available for five years immediately commencing from the year on which the construction is completed. If the house is self occupied, the maximum interest deduction is restricted to Rs.2 lacs which includes 20% of preconstruction period interest + interest for the current year. Therefore, you can claim preconstruction period interest only if the house is rented or deemed to be rented.