Claiming interest of house property one case

Tax planning 427 views 5 replies

Binod

Student CA Final

386 Points Joined February 2014

Hello, Friends

One of my Client facing following case plz suggest me

Mr. A take loan from bank (In A’s Name) for construction of House property, and finish the construction of house and register the same in his wife Name Mrs. A. And he paid to bank as interest of Rs 296000 and as principle 92000. ( all interest is post construction and taken in the year 2011)

Now my question is

How much interest can we claim and in whose name
Principle amount of loan can be claim under sec 80C in whose name.

Thanking you

Binod

Replies (5)

Income Tax Wala: (Fin. Expert)

Chartered Accountants

2015 Points Joined August 2010

Dear Binod

as no property in name of Mr. A but he paid interest and principal for construction of loan.

in that case Mr. A is not eligible for any claim with respect to 24 b and 80 c

Binod

Student CA Final

386 Points Joined February 2014

Hi Sudesh

, Another question is that if possession of house is not get by Mr A till the day and house is register in both mr A and Mrs A equally in the society can the claim before the possession .

Thank for you giving me time

Income Tax Wala: (Fin. Expert)

Chartered Accountants

2015 Points Joined August 2010

first of all it does not make any difference whether possession taken by Mr. A or not he is not eligible for deductions.

next is if property is registered in both name i.e. Mr. A and Mrs. A and possession has not been taken than they before the expiration of 3 Year from date of starting construction than also they are not eligible for dedction u/s 24 b but can calim u/s 80C

interest pertaining to pre construction period can be claimed in 5 equal installment every year starting from the year in which construction has completed.

Income Tax Wala: (Fin. Expert)

Chartered Accountants

2015 Points Joined August 2010

if property is registered in both name i.e. Mr. A and Mrs. A and possession has been taken than they both are eligible for deductions i/s 24 b and 80 C