Home Loan interest Perquisites

[LAKSHMINARAYANAN TR]

Dear All,

My client works for a bank, availed home loan. Paying Interest and Principal through salary deductions. Being a bank employees get the benefit of interest at lower rate. Difference in interest benefit is included as perquisite value and added for computation of Total Income.

Can the interest amount calculated as perquisite and included in computing total Income can be claimed as deduction U/s 24 ? Kindly clarify. Pl give if you have any citation to this effect on this type of subject.

Let me illustrate by an example.

1. Interest paid on Home Loan - ₹ 50000.

2. Perquisite value of Interest on Home Loan - ₹ 35000.

Can we claim interest on self occupied House Property ₹ 85000 or ₹ 50000 only ?

Regards

T R Lakshmi Narayanan

Chennai . Mobile NO. 9962088881

AI Summary

Deductibility of home loan interest: employer taxed perquisite value is not allowable as a Section 24 interest deduction.
The question is whether the perquisite value of concessional home loan interest included in salary can be deducted under Section 24(b). The reply states it cannot: Section 24(b) permits deduction of interest actually payable on capital, but the perquisite taxed under salary is not an interest payment to the lender, and the proviso requiring a certificate from the payee cannot be met because the bank has not received the perquisite amount as interest.