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Interest on housing loan deduction

25 July 2007

HIM NOW a days its practice that while taking homeloan for buying a house a certain portion in additoin to homeloan is taken for frunshing of house. Can the interest portion on loan which is taen for furnishing calimed as deduction under (150000 )limit available for intrest on housing loan under income from house property The bank has furnished seperate certifcates for interest paid on housing loan and loan for furnishing Reagrds Vikas sharma

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7 Replies

Rajesh Bajaj (433 Points)
Replied 25 July 2007

Loan certificate that such interest is payable in respect of the amount advance for acquisition or construction of the house maximum ceiling is Rs 150000/- If capital is borrowed for any other purpose ie reconstruction , repair , renewals of a house the maximum limit is 30000/-

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CA VISHAL B.DAVE (employee) (25 Points)
Replied 25 July 2007

deduction of rs.150000 is available only for construction o house property, same cannot be claimed for furnishing, so u may not claim that interest portion.

(Guest)

You can claim Interest taken for construction of house and not for furnishing of house. Maximum amount eligible is Rs. 1.50 lacs.

Ravi Bhushan Ambastha (pvt service) (20 Points)
Replied 27 July 2007

As per content of section 24 of I.TAX ACT maximum deduction available up to Rs.1,50,000 againt payment of interest on loan for purchasing/constructing of new house. such a deduction is availble for interest on loan for purchasing/constructing and not for furnishing of house. furnishing is different from construction so interest on loan for furnishing would not be available for deduction u/s 24 of I TAX ACT

umesh (accounting) (14 Points)
Replied 31 July 2007

it is rightly said intrest on loan for furnishing the house can not claim but what is in case of reconstruction of house ?

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Mahesh Goyal (Service) (38 Points)
Replied 02 August 2007

Sure, interest on furnishing can be allowed only if bank issues the certificates without bifurcating the interest portion into house loan and other loan.