Income tax computation with home loan

If a person is having a house loan (Pay EMI) and has not got possession of his flat then can he get any rebate in income tax.

If yes then under which clause.

 

Replies (3)

Yes, u/s. 24b........ but not during construction period.

  • The period from borrowing money until the construction of the house is called pre-construction period.
  • Pre-construction interest deduction is allowed for interest payments made from the date of borrowing till March 31st before the financial year in which the construction is completed.
  • Interest pertaining to pre-construction period is allowed as deduction in five equal annual instalments, commencing from the year in which the house property is acquired or constructed.

  • Thus, total deduction available to the taxpayer under section 24(b)​​ on account of interest will be 1/5th of interest pertaining to pre-construction period (if any) + Interest pertaining to post construction period (if any).​

Refer: under-construction-house-how-to-claim-tax-deduction-on-home-loan-interest-payments

He can get the deduction for payment of interest on housing loan u/s 24b & for principal, u/s 80C.

He cannot claim deduction during construction period. Entire interest paid during construction period has to be accumulated and claimed as deduction in five equal annual instalments, commencing from the year in which the house property is acquired or constructed.
 

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