This section deals with deduction available u/s 24(b) – Interest paid on capital borrowed for purchase, construction, repair, renewal or reconstruction of property. That is, you are allowed to deduct an amount equivalent to the total interest payable on the housing loan from your taxable income within the same financial year, the maximum amount eligible for deduction if capital is borrowed on or after 1st April 1999 in the case of self-occupied property to Rs.2,00,000.
The criteria being:
- Capital is borrowed on or after 1st April 1999 for acquiring or constructing a property.
- Acquisition or construction should be completed within 5 years (3 years, applicable up to the Assessment year 2016-17) from the end of financial year in which the capital was borrowed.
Please note that
Interest of pre-construction period is deductible in five equal instalments. The first instalment is deductible in the year in which construction of property is completed or in which property is acquired. If Capital is borrowed for any other purpose, i.e. if capital is borrowed for reconstruction, repair or renewal of house property then the maximum amount of deduction is available Rs.30,000.
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A deduction is available on repayment of principal during a financial year up to Rs.1,50,000, this aforesaid limit is within the overall limit of Rs.1,50,000 lakh specified in section 80C of the Income Tax Act.
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Stamp duty, registration fee or other such expenses paid for transfer of such house property to the assessee is also considered under this amount.
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This deduction is made from one’s Gross Total Income.
This section deals with deduction available u/s 24(b) – Interest paid on capital borrowed for purchase, construction, repair, renewal or reconstruction of property. That is, you are allowed to deduct an amount equivalent to the total interest payable on the housing loan from your taxable income within the same financial year, the maximum amount eligible for deduction if capital is borrowed on or after 1st April 1999 in the case of self-occupied property to Rs.2,00,000.
The criteria being:
- Capital is borrowed on or after 1st April 1999 for acquiring or constructing a property.
- Acquisition or construction should be completed within 5 years (3 years, applicable up to the Assessment year 2016-17) from the end of financial year in which the capital was borrowed.
Please note that
Interest of pre-construction period is deductible in five equal instalments. The first instalment is deductible in the year in which construction of property is completed or in which property is acquired. If Capital is borrowed for any other purpose, i.e. if capital is borrowed for reconstruction, repair or renewal of house property then the maximum amount of deduction is available Rs.30,000.
