Home loan interest deduc....hahaha..!!!!! mast fool..!!!

Tax planning 1574 views 8 replies

Ritesh Jain

CA CS in Job

675 Points Joined September 2008

With the high expectations zooming yesterday and quickie highlights by news channel it was just reported that

' HOME LOAN INTEREST DEDUCTION INCREASED TO 2.5 LAKH P.A'

but it is not so straight and till now it is not clear to many whether the amendmend is so simple............!!!!

No..No...No... all i can say is hon'ble FM has its own way to befool public..and worst is that he succeeded..

Mast bewkoof banaya..!!!!!

HOW..???

The deduction will be applicable for loans taken in fiscal 2013-14.

what about those who has taken loan just last year..??

The limit is for loan not exceeding 25 lakh and vaue of property should not exceed 40 lakh.

What is average rate per home/flat now a days and from where the balance amount ,a salaried employee will arrange..??

If the limit is not exhausted, the balance may be claimed in AY 2015-16

This deduction is for one time..??? what about next years.??? a loan normally runs 20-25 years..??

Extract of bill:

After section 80E of the Income-tax Act, the following section shall be inserted with effect from

the 1st day of April, 2014, namely:—

‘80EE. (1) In computing the total income of an assessee, being an individual, there shall be

deducted, in accordance with and subject to the provisions of this section, interest payable on loan

taken by him from any financial institution for the purpose of acquisition of a residential house

property.

(2) The deduction under sub-section (1) shall not exceed one lakh rupees and shall be allowed in

computing the total income of the individual for the assessment year beginning on the 1st day of

April, 2014 and in a case where the interest payable for the previous year relevant to the said

assessment year is less than one lakh rupees, the balance amount shall be allowed in the assessment

year beginning on the 1st day of April, 2015.

The deduction under sub-section (1) shall be subject to the following conditions, namely:—

(i) the loan has been sanctioned by the financial institution during the period beginning on the

1st day of April, 2013 and ending on the 31st day of March, 2014;

(ii) the amount of loan sanctioned for acquisition of the residential house property does not

exceed twenty-five lakh rupees;

(iii) the value of the residential house property does not exceed forty lakh rupees;

(iv) the assessee does not own any residential house property on the date of sanction of the

loan.

HAHAHAHAHA..!!!! :)

Replies (8)

Guest

yesterday i was watching India TV and the slab rates flaashing that increased from 2 lakh to 2.20. and this was flaashing on top.

later i found there is no changes just introduction of 2000 tax credit. from the other shows

sabse pehle sabse tez banane ka matlab kuch bhi dikha do.

bad me bolenge sabse pehle india tv ne budget flaash kiya

hahahahahahah..

CA Ayush Agarwal

Kolkata-Pune-Mumbai

27344 Points Joined October 2007

Really Fool Banaya...........

CA Ayush Agarwal

Kolkata-Pune-Mumbai

27344 Points Joined October 2007

Analysis from CA Nitesh More:-

A. INSERTION OF NEW SECTION 80EE – DEDUCTION IN RESPECT OF INTEREST ON LOAN TAKEN FOR 1^stRESIDENTIAL HOUSE PROPERTY:

DRAFTING ERRORS/GREY AREA: There is a drafting error in this sec. , which will be rectified by legislature.

Sub-sec. (5) contains the definitions of financial institution as well as housing financial company. Although loan taken from financial institution has been covered, the sec. remains silent about loan from housing financial institution.

Question: Had the legislature does not intent to allow deduction for housing finance company, why the definition of housing finance company has been included?

Suggestions: Use the words “or housing financial institutions” after the word financial institution in sub section (1). Sub –sec.(1) shall be re drafted as follows:

“(1) In computing the total income of an assessee, being an individual, there shall be deducted, in accordance with and subject to the provisions of this section, interest payable on loan taken by him from any financial institution or “or housing financial institutions” for the purpose of acquisition of a residential house property.”

a) Deduction is available even if interest is not actually paid as the word“ Payable” is used.

b) Loan must be taken for acquisition for such property only I.e. renovation, improvement not covered.

c) Deduction is available in respect of 1^st residential house property only

d) Loan must be taken from a financial institution

e) Value of such property must not exceeds 40 Lakhs

f) Amount of loan must not exceeds 25 Lakhs

CRUX OF THIS SEC.: Deduction of Interest payable on loan taken from financial institution for 1^stresidential house property is available.

Applicability: only Individual

Amount of Deduction: Interest payable or 1 lakh whichever is less

Conditions:

(i) the loan has been sanctioned by the financial institution during the f.y.2013-14;

(ii) the amount of loan sanctioned does not exceed 25 lakh rupees;

(iii) the value of the residential house property does not exceed 40 lakh rupees;

(iv) the assessee does not own any residential house property on the date of sanction of the loan.

Mihir

Wealth Manager

5293 Points Joined December 2008

Example

Individual has taken a loan of Rs. 25 lacs for 15 years at 11%

His EMI will be Rs. 27,367/-

Interest paid in the 1st year would be Rs. 234, 726/- (which will be available for deduction instead of Rs. 150,000)

A increased deduction of Rs. 84,726/-

Individual has taken a loan of Rs. 25 lacs for 20 years at 11%

His EMI will be Rs. 24,712/-

Interest paid in the 1st year would be Rs. 236,301/- (which will be available for deduction instead of Rs. 150,000)

A increased deduction of Rs. 86,301/-

Ritesh Jain

CA CS in Job

675 Points Joined September 2008

And the balance unutilized deduction can be claimed in A.Y 15-16...

Joey Tribbiani

fdg

2010 Points Joined April 2010

Originally posted by : Rakesh Mishra
	yesterday i was watching India TV and the slab rates flaashing that increased from 2 lakh to 2.20. and this was flaashing on top. later i found there is no changes just introduction of 2000 tax credit. from the other shows sabse pehle sabse tez banane ka matlab kuch bhi dikha do. bad me bolenge sabse pehle india tv ne budget flaash kiya hahahahahahah..

Dude here totally you are at fault. You were watching India TV for serious news? Only go there when you are feeling down or bored. They provide good entertainment. But news is definitely not their forte

sonu

CA Practice

205 Points Joined December 2012

By giving tax credit of 2000 they have made compulsory filling of return for assessee whose income is above 2lacs so 2.2lacs is not basic exemption even whose income is below 5lacs

hariattedsouza

Accountant

24 Points Joined February 2013

These are some nice analysis you guys have done on home loan interest. Fortunately I have already availed my home loan some time ago, so now I don’t have to think much about all this, although this will be helpful to me. Just in case, anybody is looking a home loan, then I would Reliance Commercial Finance from whom I have availed my home loan. They provide tailor made loan with easy repayment options and flexible tenure.