Hra with home loan

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

26 October 2014 please give me detail about that can a tax payer or employee take tax relief both House rent allowance which paid by him in metro city where he/she doing job and already taken a home loan at native place before come this job place ? if yes can provide me detail and circulars and other proof which is demand by DDO...... urgent plz

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@VaibhavJ

@VaibhavJ (Expert)
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27 October 2014 Refer this: http://taxguru.in/income-tax/faq-on-housing-loan-and-income-tax-benefit.html

Go thru respective sections.

pawan

pawan (Expert)
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28 October 2014 Clearly not given information about HRA and House loan in this chapter which asked by above unknown author

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@VaibhavJ

@VaibhavJ (Expert)
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28 October 2014 It is a very common misconception that people who have taken home loan cannot claim tax benefits for both home loan and House Rent Allowance (HRA).

HRA is part of salary given by the employer for meeting cost of rent.

The tax benefits for home loan fall under Section 80C and Section 24(b) whereas HRA tax benefits fall under Section 10(13A).

And as such home loan does not affect HRA and both can be availed. However there are some circumstances when one might be eligible to get tax benefits or not which are given below:

Living in own House: If you are residing in your own house for which you have taken a home loan, then you can avail deductions for home loan but not HRA since you are not paying any rent.

House under Construction: If the house is not ready for occupation, HRA can be availed. The tax deductions for interest amount of EMI will be applicable only after possession of the house.

Home Far-off: In case your house is far from work place which makes it impossible to stay in or your house is in another city, you can avail tax benefits for home loan as well as HRA.

Home on rent: if you have rented your own house and living in rented place, you can avail tax benefits on both home loan and HRA. However the rent received will be counted in taxable income.

So basically, as long as you are paying rent you are entitled to tax benefits. And if the house is ready for possession, you can get tax benefits for both principal and interest amount. And if particular situation dictates that you cannot reside in your own house, you can claim tax benefits on both home loan and HRA.

Querist : Anonymous

Querist : Anonymous (Querist)

02 November 2014 @VaibhavJ thanks sir I am clear about that both benefit are claimed last year also but DDO not satisfy with this He want document which clear this matter.So please give me link for paricular where I got this related paper