Angad (M.Com) (24 Points)
02 February 2015Can we have tax benifit on both -
'HRA' & 'Interest on housing loan'
If yes, can any one provide legal reference(which section of the act) for the same.
Please suggest as early as possible.
Nikhil Raj
(Self)
(91 Points)
Replied 02 February 2015
The Income Tax Act treats HRA and home loan deductions under separate sections independently. The two are not interconnected to each other. HRA is dealt with in section 10(13A) Rule 2A while home loans are entitled for tax benefits under section 80C (tax benefit on principal repayment) and Section 24 (tax benefit on interest payment) of the Income Tax Act. Hence, feel free to avail both tax benefits accordingly.
Nikhil Raj
(Self)
(91 Points)
Replied 02 February 2015
Interest on Housing Loan dealt under section 24 b of IT ACT 1961 is also different.
tejaswi ch
(Article Assistant)
(46 Points)
Replied 02 February 2015
claiming of both HRA & Interest on Housing Loan is Possible only when the property on which Interest is claiming is Letout. if it is self occupied, then claiming of both is not possible.
Nikhil Raj
(Self)
(91 Points)
Replied 02 February 2015
House rent allowance (HRA) is received by the salaried class. A deduction is permissible under Section 10(13A) of the Income Tax Act, in accordance with Rule 2A of the Income Tax Rules. You can claim exemption on your HRA under the Income Tax Act if you stay in a rented house and get a HRA from your employer.
Agreed :claiming of both HRA & Interest on Housing Loan is Possible only when the property on which Interest is claiming is Letout. if it is self occupied, then claiming of both is not possible.
Arif Ali
(Apt Co Advisory)
(1230 Points)
Replied 03 February 2015
Yes you can avail both claim, if you are living at rent due to job and your own property is not let out. If preperty is let out then you can not claim HRA exemption u/s 10(13A), you can calim only interest on loan for house property u/s 24b.
Saurabh Maheshwari
(B.com,ACA)
(5923 Points)
Replied 03 February 2015
To add:
You can claim deduction of Housing loan interest while arriving Capital gains as a cost of capital asset.
Refer:decision of Chennai Bench of the Income Tax Appellate Tribunal in the case of ACIT v. C. Ramabrahmam (2012).
Saurabh Maheshwari
(B.com,ACA)
(5923 Points)
Replied 03 February 2015
To add:
You can claim deduction of Housing loan interest while arriving Capital gains as a cost of capital asset at the time of transfer/sale.
Refer:decision of Chennai Bench of the Income Tax Appellate Tribunal in the case of ACIT v. C. Ramabrahmam (2012).
Vishal Goel
(Chartered Accountant)
(1693 Points)
Replied 24 February 2015
Not agree with Nikhil & Tejaswi.
If house is self occuiped then claiming of both is allowed.
Vishal Goel
(Chartered Accountant)
(1693 Points)
Replied 24 February 2015
Not agree with arif
If house is letout then claiming of both allowed.
You took a home loan and your house is now ready for occupation. You have rented the same out while you reside in a rented house. The Income Tax Act allows you to claim both HRA and home loan benefits.
However, in such a case, since you are the recipient of rent because you have let out your own house, that income is taxable at your hands.
The Income Tax Act treats HRA and home loan deductions under separate sections independently. The two are not interconnected to each other. HRA is dealt with in section 10(13A) Rule 2A while home loans are entitled for tax benefits under section 80C (tax benefit on principal repayment) and Section 24 (tax benefit on interest payment) of the Income Tax Act. Hence, feel free to avail both tax benefits accordingly.
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