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Income tax benifit on under-construction flat rentals

Tax queries 486 views 1 replies

Devendra Somankar

29 Points Joined July 2012

Hi All,

Please help me ASAP in this matter as I expained below:

I have booked the under construction flat on 04/08/2011 (Registration date), Builder has commited to give possesion on December 2012, but still some of the aminities are not completed. Builder is commiting that he will give me possession Letter in end of Feb-2013. Till then I am leaving in Rented Flat. Now my questions are: 1) Can I take Tax benifit of Home loan(principle paid + Intrest paid) and House Rent both for the period of April 2012 to Feb 2013?. 2) My Employer said that you will not get benifit of both, is this true?. 3)If Q-1 is yes- till what period we can claim both House rent and Home Loan?

Thanking you.....

Replies (1)

Giridhar S Karandikar

Team Lead

7558 Points Joined November 2011

As you ahve not got the posssession of your flat you will not get the benefit for the interest paid upto March13 for the A.Y.2013-14. However for the interst paid upto MAr13 you can get the benefit of interset paid in 5equal installments from F.Y. 2013-14 onwards alongwith the interest paid from F.Y.2-14-14 & onwards. The overall limit would however be 1.50lacs.

However you can still take the benefit of principal amount paid upto Rs 1lacs u/s 80C even if you ahve not recd the possession of flat.

You can take the benefit of rent paid by claiming exmeption u/s 10(13A), Your employr is correct in saying that you cant take the benfit of HRA & Interest on home laon since the flat is not in yoru possession.

Til you get the possession of flat you can claim the benefit of HRA & principle paid on HL.