House loan interest deduction

[madhavvan n]

housing loan interest deduction before possession of property how to be claimed can it be carried forward for any number of years since after possession if the limit of rs. 150000 is exhausted say for 3 years can this pre emi interest be allowable as deduction after the expiry of 3 rd year upto the 8th year

[Ravi Chopra]

No, you can not deferr the interest for the period prior to acqusition to claim benefit after 3 years. First installment (out to equal 5 installments) is to be claimed in the year of acquisition or possession of the house property itself. Remaining four installment shall be claimed immediately four succeeding years.

AI Summary

Pre-possession home loan interest must be claimed beginning with the year of acquisition; deferred claims are not permitted. Pre-possession housing loan interest must be claimed beginning in the year of acquisition or possession: the accrued interest prior to acquisition is apportioned and the initial portion is claimed in the year of acquisition or possession, with the remaining interest claimed in consecutive instalment years. A taxpayer may not defer claiming pre-possession interest beyond this instalment schedule to later years.