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It exemption

Tax queries 243 views 1 replies

A home was purchased by availing loan from A Bank which is self-occupied. The loan amount paid is being considered for availing IT Exemption during the same FY based on the IT Certificate issued by the bank.

Another property was purchased at a later date by availing loan from C Bank which is in under construction stage. The loan amount paid is not being considered for availing IT Exemption as it is under construction stage, the bank does not have option to give IT Certificate.

Note:- 10% of the Loan amount is pending for disbursement by C Bank yet.

Queries are –

1) Whether loan amount paid at C Bank is eligible for IT Exemption from which date onwards. As per my knowledge that only upon completion, the loan amount can be claimed as deduction for IT Purpose.

2) Whether pre-emi interest paid & EMI paid at C Bank is eligible for IT Exemption

3) If I transfer my loan at C bank to another bank this FY, what documents I have to collect from the C bank to avail IT Exemption and in which period i.e. FY it can be claimed.

4) If I can claim exemption this FY itself, then do I have to calculate Income from house property for an under construction property also and pay IT for that on deemed to be let out basis.

Replies (1)

1) and 2) Since Loan Amount Paid To Bank C Is Elgible To Deduction U/s 24b as Interest Amount and U/s 80C Principal Amount on Completion Of House.

Pre EMI Paid before construction of House in that case first on completion of House you have to calculate the notional income from house property on the basis of DLOP and Pre EMI Interest portoin can be claim deduction u/s 24b in 5 Equal Installment.

3) on the transfering loan u will not get even exemption  till the time construction of house is not completed

4) You will not able to claim exemption on DLOP till the time house construction is not completed


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