25 July 2018
i have taken home loan in march but my first interest decduction started from april. do i need to show it F.Y. 2017-18 .please clear me the concept. URGENT
02 August 2024
When dealing with home loan interest deductions, here's how you should handle it for the financial year:
### **Understanding the Deduction Timing**
1. **Financial Year and Loan Disbursement:** - If you took a home loan in March 2017 but the EMI payments, including interest, started from April 2017, the deduction for interest on the home loan would typically be applicable from the financial year 2017-18 onwards, as the interest payments began in that financial year.
2. **Claiming Deduction in the Correct Financial Year:** - **Financial Year 2017-18:** For this year, you will claim deductions for the interest paid from April 2017 onwards. - **Interest Paid:** Only the interest paid during the financial year 2017-18 (April 2017 to March 2018) can be claimed. Even though the loan was disbursed in March 2017, since no interest payment was made in FY 2016-17, you cannot claim any deduction for that period.
### **Details on Interest Deduction:**
1. **Section 24(b) of the Income Tax Act:** - Under **Section 24(b)**, you can claim a deduction of up to ₹2 lakh per annum on interest on a home loan for a self-occupied property. This deduction is available for the financial year in which you actually pay the interest.
2. **Pre-construction Interest:** - If the loan was taken for construction or purchase of a property and the property is under construction, the interest paid before the construction is completed can be claimed in five equal installments from the year in which the construction is completed.
### **Example Scenario:**
- **Loan Disbursement:** March 2017 - **Interest Payments Start:** April 2017 - **Financial Year 2017-18:** - You can claim interest paid from April 2017 to March 2018, even though the loan was disbursed in March 2017.
### **What to Do:**
- **For FY 2017-18:** - Include the total interest paid from April 2017 to March 2018 while filing your return for FY 2017-18. - Ensure that you have the necessary documentation, such as the loan statement from the bank, to substantiate the claim.
### **Conclusion:**
- **Home Loan Interest:** For the financial year 2017-18, you can claim deductions only for the interest actually paid during this period (April 2017 to March 2018). Even if the loan was disbursed in March 2017, no deduction is claimable for the period before April 2017. - **Document Verification:** Keep proper records and statements from the bank to support your claim.
If you have any further doubts or specific scenarios, consulting a tax professional can provide personalized assistance.
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