Interest on housing loan
This query is : Resolved
03 April 2014
A resident assesse has taken housing loan from bank and build-up a house. in this house assessee has started the business. whether this loan interest has allowed as business expenditure or loss from house property.
03 April 2014
it will have to be deducted from income from house property head only u/s 24(b).
04 April 2014
Dear Tushar, please note that this case wont be covered under 24(b). please read section 22 which clearly state that
"The annual value of property consisting of any buildings71 or lands appurtenant thereto of which the assessee is the owner, other than such portions of such property as he may occupy for the purposes of any business or profession carried on by him the profits of which are chargeable to income-tax, shall be chargeable to income-tax under the head "Income from house property"."
Hence, if any part of the property is used for business or profession, it shall not be covered house property itself.
Accordingly, the interest deduction can be claimed only under business/profession and not under house property.
"The annual value of property consisting of any buildings71 or lands appurtenant thereto of which the assessee is the owner, other than such portions of such property as he may occupy for the purposes of any business or profession carried on by him the profits of which are chargeable to income-tax, shall be chargeable to income-tax under the head "Income from house property"."
Hence, if any part of the property is used for business or profession, it shall not be covered house property itself.
Accordingly, the interest deduction can be claimed only under business/profession and not under house property.
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