Home Loan Interest

[Shyam .]

hi,

I have two house. One is self occupied and other is deemed to let out.  I took a loan for house which is deemed let out. Now, can I claim deduction for Interest for current year along with 1/5th of pre-conustrction period which is exceeds 1.5L.

For e.g :

Current year Interest : 1.80 L

1/5th Pre Conustruction : 25K

Can i claim 1.5 L and 25K or 1.5 in totality ? please guide.

As for Section 24 deduction, on your self occupied house you can take advantage of interest payments up to Rs.1,50,000. For the other property, you can claim actual interest repaid, there is no limit for the same.
[6:42:45 PM] Sastry Boddapati: I think I can claim the entire actual interest paid this year if I treat one house as self occupied and treat this loan house as othe

[ROHAN THAKKAR]

Dear Shyamsundar Ji,

 

The cap  of Rs1.5 lakh is applicable only for self occupied property. In case if the house is let out, then there is no cap. Thus, entire interest can be claimed as deduction..

[Shyam .]

Thanks Sir, 

What about the interest of pre-consutruction period. If house is let out.

 Thanks,

Shyam

[ROHAN THAKKAR]

Dear Shyamsundar Ji,

The pre construction interest will be available equally for 5 years i.e., 1/5th every year. However, there is no cap of 1.5 lakhs. Thus, pre construction and post construction interest can exceed 1.5 lakhs and the same will be available if the house is let out.

 

AI Summary

Home loan interest deduction: no cap for let-out properties, and pre-construction interest is spread over multiple years. Interest deduction rules vary by property occupancy: the self-occupied property cap limits deductible interest for a primary residence, whereas interest on a let-out property is fully deductible without that cap. Pre-construction interest must be capitalised and is allowable in equal instalments over five years after completion; when the property is let out those apportioned pre-construction amounts are not subject to the self-occupied ceiling.