Pre emi interest on second house

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 September 2013 I am salaried person & booked under construction flat in October, 2011. This is my second flat(first flat is free). I have taken the loan from SBI. SBI has collected 12 months post dated cheques from Nov 11 to Nov 12 for interest on disbursement of loan. As per agreement with SBI, EMI was started from December 12 (i.e. after 12 months). The builder has given the possession in June 2013. Now for tax calculation I have considered the following points :-
1. Estimated rent to be received from Jul 13 to March 14
2. Expected Municipal Tax
3. Net Rent Received
4. Standard Deduction
5. Taxable Rent

Now my query is about pre-emi interest component is to be considered upto which period(i.e.Nov.11 to Nov 12 or Nov.11 to May 13,possession date is 13th june 13)and divide in 5 equal installments. This is my first year to take income tax deduction. Kindly reply in detailed. Regards.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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29 September 2013 Interest paid upto the year before the year in which the possession is recevied/ construction is completed needs to be claimed in 5 annual installments.

Interest paid between October 2011 to March 2013 needs to be claimed in 5 installments. First installment is to be claimed in FY 2013-14 (AY 2014-15).
Along with this annual installment, you shall also claim interest paid during the year from FY 2013-14 onwards.

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