Housing Loan Benefit u/s 192

[Rahul Bagaria]

We as an employer provides loss from house property benefit while deducting tax u/s  192. We consider self occupied property as well as let out property and as a result an employee gets relief for more than one house and the deduction limit is not restricted to Rs 1,50,000. We satisy ourselves with all right kind of documents in this regard. One of the big 4 firms are dusputing this claim and says that only as an employer I am liable to provide relief for one house i.e., self occupied property and interest amount should be restricted to rs 1,50,000. However going by the provisions of section 192, it no where talks about the same. Valuable opinion are solicited from the members of this site.

[Surender Gupta]

Yes, you are right, provisions of section 192(2B) clearly states that "Loss from House Property" can be considered by the employer while deducted TDS from salary. But, in my view this provision has been introduced considering the loss from house property due to self occupied property. Employer can ascertain and verify the maximum amount of permission loss from the facts and details provided by the employee in case of self occupied property. But, in case of let out property, it may the the fear in the mind of employer that, it is not be possible for him (employer) to ascertain the same correctly and therefore, if he deduct TDS on lower amount (after given effect of incorrect loss), income tax officers will not leave him without facing the consequences. You are correct that section 192(2B) does not specifically differentiate between loss from self occupied property or loss from let out property therefore you may take up the matter with the employer and allay the fear of the employer by referring the above provisions.

[Yash Gupta]

In my view an employer should only consider the interest amount on loan borrowed u/s 24 for the self occupied House Property and should not extend the benefit of allowing the employee to declare loss under the head 'Income form House Property' considering all the provisons / sections 22 to 27 which may also include the employee's rented out house property.

[DEV KUMAR KOTHARI]

On bare reading of S. 192 you can consider the loss under head 'income from house property' based on relevant information duly supported by declaration of employee. As employer, the deduction can be allowed only against salary income and not income form other source, if any declared by employee to employer. However, you advise your team to carefully read the Circulars of board which are issued every year i.r.o. salary and TDS.

AI Summary

Loss from house property: employer may allow deduction for TDS if verified by employee declaration and supporting documents. Section 192(2B) permits an employer to consider loss from house property when deducting tax at source from salary if satisfied with the employee's declaration and supporting documents; the deduction is allowable only against salary income, and although the statute does not expressly limit the benefit to self occupied properties, employers should exercise caution and verify losses-particularly for let out properties-to avoid compliance risk.