Annual value - taxability of the property

[rahul kumar]

1.)an individual working in a pvt company resides in delhi in a rented house. 2.)he owns a house in delhi which is situated 30km far from his working place.this house was vacant for the complete year(f.y-2008-09) 3.) for the financial year 2008-09 he received house rent allowance @rs.6000/-p.m and paid rent @ rs.7500/-p.m 4.)for the financial year he paid rs.20000/- as interest on housing loan taken from hdfc now my question is-whether he can claim exemption for hra u/s10(13A)and simultaneously deduction u/s 24 from house property income for interst paid on housing loan?whether the annual value of his house property will be taken as nil because the house was remeined vacant throughout the year.

[Ravi Chopra]

A house which is own by you but you could not occupied the same due to employment is eligible for self occupied house benefits. But, you need to ascertain that same has not been let out for a single day for the relevant period. Since the employee is living in a rented house, he is entitled to HRA benefits. Therefore he can avail both the benefits simultaneously.

AI Summary

HRA entitlement can coexist with housing loan interest deduction where an owned house remained unlet due to employment elsewhere. An individual living in a rented house may claim House Rent Allowance (HRA) for that accommodation while an owned residence that remained unlet throughout the year because of employment away from it can be treated as self occupied (or vacant but not let out), yielding a nil annual value and permitting claim of housing loan interest deduction against house property income, provided the property was not let out and statutory conditions and documentation for the interest deduction are met.