how to calculate interest in income from house property under statutory deduction u/s24...........please help
how to calculate interest in income from house property under statutory deduction u/s24...........please help
| Originally posted by : Gauri Agarwal | ||
 |
how to calculate interest in income from house property under statutory deduction u/s24...........please help |
 |
Interest on borrowed capital on accrual basis + 1/5th of the interest, if any, belonging to pre-construction period.
|
<------------------------------Pre Construction Period---------------------------------------> |
|
|
Day of commencement of construction OR Day of borrowing whichever is later |
Ending on March 31 immediately prior to the year of completion |
Pre construction Interest = Funds borrowed X rate of interest X pre construction period
1/5th deduction, for 5 consecutive years, starting from the previous year in which property is acquired or constructed.
> Interest on fresh loan taken to repay the original loan = deductible
> Interest on Interest = Not deductible
Interest on Borrowed Capital:
1) Let out/Deemed to be let out
o On accrual basis + 1/5th of interest, if any, of pre-construction period
o Entire interest allowed as deduction.
2) Self Occupied
o Max 150000 (incl. 1/5th of pre construction period)
o for acquisition or construction
o loan taken on or after 1.4.99
o construction completed within 3 years from the end of financial year in which loan was taken
o certificate received from lender
o New loan also covered
o Any other case = 30000
Interest payable outside india is not allowed as deduction if TDS has not been deducted and there is no person in India who may be treated as an agent.
CAclubindia
