Home loan interest deduction

Housing loan interest deduction, on the other hand, is allowed up to a maximum amount of Rs 1,50,000 under section 24(b). However, the acquisition or construction of the house property should be completed within 3 years from the end of financial year in which home loan was taken; otherwise, the amount of interest benefit allowed is only up to Rs 30,000. 
Furthermore, the above tax deduction limit u/s 24(b) is applicable only for self-occupied house property. In case of let-out or deemed to be let out house property, interest is deductible without any limit.
 

Hope it will help but see for other suggestions also

IN YOUR CASE YOU CAN TAKE DEDUCTION OF INTEREST AFTER COMPLETION/ACQUISITION OF HOUSE/FLAT.

AT THAT TIME YOU WILL TAKE DEDUCTION OF ACTUAL INTEREST PAID AT THAT TIME & PRE-CONSTRUCTION INTEREST(PROPORTIONATELY IN 5 YEARS).

AS YOU ARE GOING TO GET ACQUISITION OF FLAT IN 2015 i.e AFTER 3 YAERS. THE MAXIMUM LIMIT OF INTEREST DEDUCTION YOU CAN TAKE IS  RS-30,000/-.

FOR MORE DETAILS READ SECTION 24(b) OF IT ACT 1961

U can show house as deemed let out and claim deduction without any limit. 

HI

1. Since its a self occupied property, you will allowed a deduction maximum upto Rs. 30000

2. Interest has to be allocated in two parts. Part I pertains to the period from date of availing loan to the end of financial year previous to FY in which you will get possession. i.e. if you taken loan in 15th april, 2010 and possesion is going to receive on 12th june 2015, then interest has to be calculated for the period 15.04.2012 to 31.03.2015. Such interest termed as Pre-Construction Interest and will be allowed as deduction in five years starting from the year in which possession taken. Thus for first part interest you will get 1/5th equated pre construction interest for FY 2015-16 onwards till FY 2019-20

second part of interest allowed as deduction denotes interest frm 01.04.2015 i.e. after pre construction period. This will be taken based on interest certificate received from Bank/financial institution.

Total of first part and second part will allowed as deduction under sec 24(b) subject to maximum of Rs. 30,000. This will solve your third query as well.

Hope this all solves your query..

Thanks and Regards,

Manoj B. Gavali

So if I understand correctly, if I stay in the flat I can claim a maximum deduction on home loan of INR 30,000 - including pre emi interest.

However, if I rent out the flat, irrespective of how many years later I get the flat, I can claim tax rebate on the interest on home loan without any limit. Is this correct? 

Also, in case rent out the flat, is there any eligibility to claim any deduction on pre emi interest? Please do keep in mind that pocession of the flat will be 5 years from date of disbursement of the home loan.

Yes , if you show your flat as deemed let out then you can claim interset deduction without any limit. including  pre construction period interest

Limit of interest deduction is for self occupied property.i.e. property which is not rented, if you rented property, then no limit on maximu amount of interest deduction under section 24(b).

Calculation of pre construction interest and its allowawibility is same for both elf occupied and rented property. so pre construction interest would be admissible as provided in my earlier reply.

Sir,

please i've a more query ,

is there no limit to claim interset deduction irrespect of how much income i'm getting from that house property.

Dear Vinod,

Yes there is no limit for interest deduction.

dear members,

can anyone please give me practical example regarding housing loan intrest and principal treatment

my doubt is why intrest is more than principle amount