Sec.80 C deductions in respect of resigned employees

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vijaya ganesh (Querist)
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07 July 2011 Hi,

I need a clarification.

If an employee resigns during the financial year, whether credit can be given for entire interest on housing loan that would be payable by him for that financial year u/s 80C or actual amount paid by him till the date of resignation should be given as deduction u/s 80C.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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07 July 2011 Interest is deductible U/s 24 and principal repayment is deductible U/s 80C.

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As a matter of prudence, credit should be given up to the period till he remains with the employer. U/s 80C credit is given on the basis of payments actually made by the employee towards repayment of housing loan.
However, in case of interest credit can be given on the basis of interest accrued till date.

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