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Deduction for Pre-construction Interest

Sumit (1 Points)

04 February 2024

I had taken a Home Loan in 2014 and had repaid the Home Loan fully in 2017. However, I got possession of House in 2021 only. I had paid total Interest of about Rs 12 lacs on my Home Loan. Can I claim deduction for Interest paid for the period 2014-2017 while filing ITR for AY 2024-25? I have not yet claimed any deduction so far on this Interest. And my House is not yet registered even though I have got NOC and Possession Letters from Builder.

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Saravanan nagaraj (463 Points)
Replied 04 February 2024

To avail Pre Construction Interest:

You need to fullfill as following conditions:

1) When you have taken a loan for the purchase or construction of a house property, you can claim a deduction on pre-construction interest.

2) However, this is not allowed in the case of the loan for repairs or reconstruction.

3) The loan has been taken after 1st April 1999 for purchase or construction

4) The acquisition or construction is completed within 5 years from the end of the financial year in which the loan was taken

5) There is an interest certificate available for the interest payable on the loan.

6) Pre-Interest can be claimed upto Rs.2,00,000/-

7) Pre-Interest can be avail 1/5 after completed construction within specific period.

Please consultant with your Tax Accountant or Chartered accountant.

Without NOC from your builder you can't declare that your construction has been completed.

You may discuss with a local lawyer and first issue a legal notice and after that you can plan further legal action against the builder. 1. IF your agreement is duly registered & Stamp Duty paid, THEN builders NOC or any other document is not required, at all.

Thanks