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Property outside India

Dipjyoti Majumdar (CA in service & CS. dipmaj@ rediffmail.com ) (3468 Points)

15 July 2011

A returning Indian back to a resident status after being a NRI for long has made investment in property in Dubai can claim tax deductions when filing his returns in India on the EMI remitted out of Indian bank account or paid out of his savings left behind in Dubai. In other words you have invested in a house under construction at Dubai. The property will be ready in two years and you are already paying the EMI. If you decide to return to India and continue servicing the EMI’s out of salary income in India then will you be entitled to tax exemption in India on the EMI payment and if so upto what extent annually.

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Alpana (Consultant) (91 Points)
Replied 15 July 2011

The BCAJ issue for June 2011 includes an article on controversies surrounding 'reinvestment in overseas premises'. The said article, in the context of sections 54 and 54F, analyses and concludes that an assessee should be entitled to claim exemption in respect of reinvestment in overseas premises. Applying the same analogy, other benefits available under the Act should also be available to the assessee subject to fulfilment of other conditions.

CA. Anuj Gupta (Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA) (7014 Points)
Replied 15 July 2011

Originally posted by : Dipjyoti Majumdar
	A returning Indian back to a resident status after being a NRI for long has made investment in property in Dubai can claim tax deductions when filing his returns in India on the EMI remitted out of Indian bank account or paid out of his savings left behind in Dubai. In other words you have invested in a house under construction at Dubai. The property will be ready in two years and you are already paying the EMI. If you decide to return to India and continue servicing the EMI’s out of salary income in India then will you be entitled to tax exemption in India on the EMI payment and if so upto what extent annually.

The interest paid before the completion of house shall be clubbed and claimed in 5 equal yearly installments after the certificate of Completion of House property is obtained .

Anuj

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