https://www.taxtmi.com/article/detailed?id=5133 Prepayment charges on early repayment of housing loans are compensatory receipts equivalent to interest, representing loss of anticipated interest and a charge for unused credit. Under the statutory definition of interest and the deduction framework for house property, tribunals have treated such prepayment charges as interest connected with acquisition financing and have allowed their deduction; similarly, interest on a new loan taken to repay an earlier housing loan may be treated as borrowing for acquisition and thus allowable where directly linked to the property financing. en-us Fri, 17 May 2013 12:52:13 +0530 Fri, 17 May 2013 12:52:13 +0530 TaxTMI RSS Generator https://www.taxtmi.com/article/detailed?id=5133 Prepayment charges on early repayment of housing loans are compensatory receipts equivalent to interest, representing loss of anticipated interest and a charge for unused credit. Under the statutory definition of interest and the deduction framework for house property, tribunals have treated such prepayment charges as interest connected with acquisition financing and have allowed their deduction; similarly, interest on a new loan taken to repay an earlier housing loan may be treated as borrowing for acquisition and thus allowable where directly linked to the property financing. Articles Income Tax Fri, 17 May 2013 12:52:13 +0530 https://www.taxtmi.com/article/detailed?id=5133