Dear Sir,
I have taken home loan.
The Interest and principle amount paid is exemption under which section of Income tax rule?
Also where this exemption should be mentioned in ITR1 form to get the tax benefit?
Thank you sir.
Alpesh
14 Replies
C.A. Jignesh N. Mehta
(C.A.)
(1030 Points)
Replied 31 July 2013
Dear Alpesh
1. If the house on which loan is taken is only house and you stay in that house then:
a) Prinicipal amount paid by you is claimed u/s 80C
b) inetesrt upto 1.5 Lakhs maximum is allowed as loss from house property - u/s 24(b)
subject to loan was for purchase of house or for construction of house.
2. If the house on which loan is taken is under construction as on 31.3.2013
then you cannot claim interest.
a) but you can avail 80C deduction.
3. If the house is complete and you have another house then you need to file ITR 2 as you have more than one house.
Rest is same as in 1 above.
If you want to add to your query the answers above may change based on your query.
Jula Nair
(Scientist)
(23 Points)
Replied 25 August 2013
Dear Sir,
As per the advice of the Income Tax experts, My husband and I took a joint home loan for purchasing an apartment and got it registered jointly. Both of us earn equal salary. As per the EMI, the amount to be paid in the financial year 2013-14 is Rs.3,77,568 with the interest component as Rs. 2,40,274. Both of us sought a deduction of Rs. 1,20,137 each as loss from self occupied house property as both of us are eligible for a maximum deduction of Rs. 1,50,000 individually. This is also supported by the model calculations and clarifications provided by the experts of various financial websites and business channels. Unfortunately, my office refuses to admit my claim in full and their stand is that I am eligible for only a deduction of Rs. 75000. As per them, for a house, the maximum deduction available is Rs. 1,50,000. Please clarify and advise me how I would convince my office.
Jula
Mihir
(Wealth Manager)
(5293 Points)
Replied 26 August 2013
Interest on housing loan for a joint ownership can be claimed u/s 24 by each of the owners for upto 150,000/- . If the interest paid is less than 150,000/- , then the ratio of ownership in the property shall be considered.
CA Pallav Singhania
(IT System Auditor)
(33672 Points)
Replied 26 August 2013
Interest paid on the home loan
In the budget presented on 28th feb 2013 the interest limit on housing loan has been increased from RS 1.5 L to 2.5 L for claiming income tax exemption
As per Sec 24(b) of the Income Tax Act, 1961 in India a deduction up to Rs. 150,000 can be claimed as tax exemption on housing loan. This deduction is claimed towards the total interest that we pay on the home loan towards purchase or construction of house property while computing the income from house property.
The interest payable before you acquire home or start the construction work would be deductible in five equal annual installments commencing from the year in which the house has been acquired or constructed.
In case of self- occupied property, housing loan tax benefit is allowed only for one such self – occupied property. The interest towards home loan taken for purchase, construction, repairs, renewal or reconstruction of house property is eligible for deduction under section 24(b).
Principal repayment of the home loan
As per the newly introduced Sections 80C read with section 80CCE of the Income Tax Act, 1961 the principal repayment up to Rs. 100,000 on your home loan will be allowed as a deduction from the gross total income subject to fulfillment of prescribed conditions.
Jula Nair
(Scientist)
(23 Points)
Replied 26 August 2013
Thank you Mr. Mihir. But what if my office does not agree? Is there any illustration or clarification from the Income Tax department specifically on this?
Mihir
(Wealth Manager)
(5293 Points)
Replied 26 August 2013
Just ask them to consult their CA or refer to some Income tax book or on the internet.
Mohit Khandelwal
(Tax Consultant)
(30 Points)
Replied 26 August 2013
Jula, You need to explain your employer that the limit of Rs. 1,50,000 is per assessee and not per house. Also explain them with the help of Section 26 - Property owned by co-owners which has a explanation referring section 23(2) i.e. relief in case of SOP.
Jula Nair
(Scientist)
(23 Points)
Replied 26 August 2013
Thanks Mihir and Mohit. Hope I can get the issue resolved. But I doubt, since the dealing group beleives that they are best income tax experts.
uma ganesh
(not applicable)
(22 Points)
Replied 27 February 2014
sir,
my husband is working in syndicate bank form where he has availed housing loan in 1998
it is a funded interest loan.so he has to pay the interest portion only after the principal
portion is over.he has to pay 1670 per month as per agreement towards principal and he is
paying it reguraly.so rs.20040 per year towards princiapl.so my question is
a.he will get exemption of 20040 under repayment towards principal,isnt it?
b.since he has to repay interest portion only after the principal portion is over, interest accrued
in each financial year, can he deduct that interest portion form income diretly for arriving
taxable income though he is not paying interest portion during the year as per agreement
please clarify at the earliest
umaganesh
for arriving taxable income
SURESHAN K
(Auditor)
(189 Points)
Replied 27 February 2014
Interest can be claimed on accrual basis but limited to maximum of Rs 30,000/-
uma ganesh
(not applicable)
(22 Points)
Replied 27 February 2014
ref: scoreboard 21 and scoreboard 41
int exemption upto 150000 is allowed for housing loans from which year?and
the limit i have metnioned above is correct?(for housing loans where interest payable is to be
paid only after the principal is fully paid).since the matter is very urgent ,reply at the
earliest will be really helpful
umaganesh25 @ yahoo.in
SURESHAN K
(Auditor)
(189 Points)
Replied 28 February 2014
150000 is allowed on borrowings on or after 01/04/1999. Refer proviso 1 and 2 to section 24(b) of IT Act
Income Tax Wala: (Fin. Expert)
(Chartered Accountants)
(2015 Points)
Replied 28 February 2014
yes section 26 of income tax 1961 is perfect for this query
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