Interest expense set off from rent earned.

This query is : Resolved

Ankit (Querist)
Follow

18 August 2015 Suppose i put my residential house on mortgage and get a loan against it and i am paying interest on such loan taken, now from such loan acquired i am purchasing another property and earning rent by giving such new acquired property to a tenant.
in this case can i claim deduction of interest on loan from the rent income earned from second property by showing direct nexus between the two amounts of loan taken and amount spent on acquiring the second property?

Deepti Asawa

Deepti Asawa (Expert)
Follow

18 August 2015 YES, YOU CAN CLAIM INTEREST ON HOUSING LOAN IN THIS CASE

Message likes : 1 times

Ankit

Ankit (Querist)
Follow

19 August 2015 But can i claim the same under other sources head by showing that to earn the rental income on the new acquired property we have incurred the expense of interest on loan taken.

Deepti Asawa

Deepti Asawa (Expert)
Follow

20 August 2015 If property is a building than you should show your rental income in Income from house property head.
If property is other than building than both rental income and interest should show in income from other sources.
Expenditure nature depend on income source. So that interest also charged on Other source if rental income reeived from other than building

Message likes : 1 times

Ankit

Ankit (Querist)
Follow

26 August 2015 Thanks for the response.
What if both the above properties are my commercial establishments?

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now