Principal amount for home loan
This query is : Resolved
29 July 2020
Sir,
I have taken home loan in 2019 for construction of my own house for self occupied.
I have paid principal amount 28349 and interest 81791,total-110140.
Now in FY 2019-20 of Income tax can i claim both under 80C and sec24.or i have to claim after completion of my construction.
Please suggest.
I have taken home loan in 2019 for construction of my own house for self occupied.
I have paid principal amount 28349 and interest 81791,total-110140.
Now in FY 2019-20 of Income tax can i claim both under 80C and sec24.or i have to claim after completion of my construction.
Please suggest.
29 July 2020
You have to claim after completion of construction. Accumulate interest till completion and claim it over a period of 5 years after completion.
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29 July 2020
Sir,
That mean i cannot claim till 5year nither interest nor principal.
That mean i cannot claim till 5year nither interest nor principal.
29 July 2020
Yes, till completion of construction.
Period between when the money was borrowed up to construction of the house is called as “Pre-construction” period. Until possession of the house, the borrower will have to just pay interest on the loan amount borrowed to the lender, this is called as “PPI- Prior Period interest”
The income tax law provides for the claim of such interest also, called the pre-construction interest, as a deduction in five equal instalments starting from the year in which the property is acquired or construction is completed.
If borrower repay the principal during pre-construction period to lender, then this is not eligible for tax deductions.
Period between when the money was borrowed up to construction of the house is called as “Pre-construction” period. Until possession of the house, the borrower will have to just pay interest on the loan amount borrowed to the lender, this is called as “PPI- Prior Period interest”
The income tax law provides for the claim of such interest also, called the pre-construction interest, as a deduction in five equal instalments starting from the year in which the property is acquired or construction is completed.
If borrower repay the principal during pre-construction period to lender, then this is not eligible for tax deductions.
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