Rental income and housing loan dedeuction
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
09 October 2012
Please be advise when receiving rental income on house taken on loan?
thank you for your help
thank you for your help
09 October 2012
Interest Paid on Housing Loan is Deductible u/s 24 b of Income Tax Act Maximum 1.5 lacs per Year.
Principle Paid Deduction u/s 80C Maximum 1 Lacs.
Principle Paid Deduction u/s 80C Maximum 1 Lacs.
09 October 2012
INTEREST ON BORROWED LOAN(U/S.24(b)): FOR SELF OCCUPIED PROPERTY
a. If Property is acquired or constructed with loan taken after 01/04/99 and construction is completed within 3 years from the end of the financial year in which the capital was borrowed – Rs.1,50,000 or actual interest paid/payable whichever is less is deductible.
b. If new housing loan is taken for repayment of old loan (old loan taken after 1/4/99) – Rs.1,50,000 or actual interest paid/payable whichever is less is allowed as deduction.
c. If Property is acquired or constructed with loan taken before 01/04/99, Rs.30,000 or actual interest paid/payable whichever is less is allowed as deduction.
d. If loan taken for Repairs, renewal, reconstruction of property, Rs.30,000 or actual interest paid/payable which ever is less is allowed as deduction.
FOR LET OUT PROPERTY, actual interest paid/payable can be claimed as deduction. Deduction u/s 80C repayment of principal Home Loan Principal Repayment: The Equated Monthly Installment (EMI) that you pay every month to repay your home loan consists of two components – Principal and Interest.The principal component of the EMI qualifies for deduction under Sec 80C. Even the interest component can save you significant income tax – but that would be under Section 24 of the Income Tax Act.
For your query, the entire interest paid or payable can be claimed as deduction since you are receiving rental income on let out property. However, the rent is to be shown as income from such properties. 30% of rent received and municipal taxes paid are available for deduction of tax
a. If Property is acquired or constructed with loan taken after 01/04/99 and construction is completed within 3 years from the end of the financial year in which the capital was borrowed – Rs.1,50,000 or actual interest paid/payable whichever is less is deductible.
b. If new housing loan is taken for repayment of old loan (old loan taken after 1/4/99) – Rs.1,50,000 or actual interest paid/payable whichever is less is allowed as deduction.
c. If Property is acquired or constructed with loan taken before 01/04/99, Rs.30,000 or actual interest paid/payable whichever is less is allowed as deduction.
d. If loan taken for Repairs, renewal, reconstruction of property, Rs.30,000 or actual interest paid/payable which ever is less is allowed as deduction.
FOR LET OUT PROPERTY, actual interest paid/payable can be claimed as deduction. Deduction u/s 80C repayment of principal Home Loan Principal Repayment: The Equated Monthly Installment (EMI) that you pay every month to repay your home loan consists of two components – Principal and Interest.The principal component of the EMI qualifies for deduction under Sec 80C. Even the interest component can save you significant income tax – but that would be under Section 24 of the Income Tax Act.
For your query, the entire interest paid or payable can be claimed as deduction since you are receiving rental income on let out property. However, the rent is to be shown as income from such properties. 30% of rent received and municipal taxes paid are available for deduction of tax
Querist : Anonymous
Querist :
Anonymous
(Querist)
30 October 2012
thank you for your help
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