Tax benefit on loss / income on let out house property

This query is : Resolved

Sachin Varshney (Querist)
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15 January 2014 Hi Sir,
This is Sachin. My query is as follows:

I have purchased a property in 2012 and got the possession last year in 2013. But I have not occupied it yet as I am working far away from it and is currently residing in a Rented house, nearby to my Office, in the SAME City. So, my property is neither occupied by me nor I put it on Rent as I am not getting the good tenant deals. I am paying the regular EMIs for the home loan taken for said property.

So, in above situation, please let me know, how I could claim both the tax benefit under section 24(b) for the interest I am paying for it and the HRA. Following are the choices -

1) Loss on Self-Occupied house property section. And Claiming HRA as well with some sort of declaration stating the above situation
OR
2) Loss / Income on Let out House Property - What rental income to show as the income from the property.

OR

3) Suggest any other solution.

Thanks,
Sachin Varshney

AVTAR SINGH

AVTAR SINGH (Expert)
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15 January 2014 1.You can claim exemption of HRA.
2. You can claim interest u/s 24 after showing that the house could not actually be occupied by you owing to your employment at other place. The annual value would be nil and interest paid by you will be shown as loss.

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Sachin Varshney

Sachin Varshney (Querist)
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16 January 2014 Ok Thanks for the reply. So where should i claim this interest being paid by me, under Section 24 (b)

- Loss on Self Occupied house property OR
- Loss/Income on Let out House Property. If yes in this, then the form which i am filling it is asking for Notional Income as per municipal community.

Please suggest

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Sachin Varshney

Sachin Varshney (Querist)
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17 January 2014 I am re-opening this. Please revert!

AVTAR SINGH

AVTAR SINGH (Expert)
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17 January 2014 Since the House was not let out, it will be treated as self occupied. The annual value will be Nil and interest can be claimed as loss from self occupied property.
I would like to add that if the house is let out for any part of the year then such house cant be treated as self occupied and annual value must be computed as if house is let out.