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HOUSING LOAN PRE EMI INTEREST

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mayuri

Tax Consultant

192 Points Posted on 02 July 2023

Hello everyone,

One of the client has paid 4 months Pre Emi Interest for the last FY 2022-23 (Asst year: 2023-24), and he got Occupancy Letter in the month of March.

As per bank certificate:

PRINCIPAL COMPONENT Rs. 8,441.00

INTEREST COMPONENT Rs. 49,833.00

PRE-EMI INTEREST Rs. 1,23,989.00

While filing return, which interest amount to be considered?

Replies (8)

Quick Summary

This discussion clarifies the tax deductibility of housing loan pre-EMI interest. While the standard interest component paid after occupancy is fully deductible, pre-EMI interest paid in a previous financial year is subject to specific rules. Only one-fifth of the pre-EMI interest can be claimed as a deduction in the current assessment year, with the remainder spread equally over the next four years.

Manish

869 Points Posted on 02 July 2023

Both interest components will be considered.

rama krishnan

5751 Points Posted on 02 July 2023

The entire interest component can be claimed as deduction. with respect to prior period interest, only 1/5th of 123989 has to be claimed as deduction and the rest of the amount has to be claimed in equal proportions in 4 assessment years

RAJA P M

"Do the Right Thing...!!!"

77792 Points Posted on 02 July 2023

Interest: Only can be claim for the interest amount of Rs 49833/-

mayuri

Tax Consultant

192 Points Posted on 02 July 2023

He got occupancy in March, can't the entire interest can be claimed

rama krishnan

5751 Points Posted on 02 July 2023

Only 1/5th of the prior period interest can be claimed for an assessment year

Manish

869 Points Posted on 03 July 2023

Originally posted by : mayuri
	He got occupancy in March, can't the entire interest can be claimed

Yes, Mayuri. Both interest allowed.

RAJA P M

"Do the Right Thing...!!!"

77792 Points Posted on 03 July 2023

No, Both interest not available for deduction.
Only claim for the FY portion on the same years...

Sahil Dodeja

24 Points Posted on 19 July 2024

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