Become a Govt. Certified GST Practitioner in just 60 hrs. Register Now!

Sec 24 : 7 months self occupied+ 5months rental

nri_123 (Mgr) (29 Points)

20 July 2012

Hello

I wanted to know if a property was self-occuopied from 7 months and let out for 5 months in the PY, then the interest deduction allowed under sec 24(b) - will it be 1.5 lakhs or unlimited ?

Thanks for your valuable inputs.

Reply
Follow
Share

4 Replies

CA.Varalakshmi.M (Manager-Finance) (482 Points)
Replied 20 July 2012

Divide the interest on loan between 7 mnths and 5 mnths.

7 mnths interest comes to Rs.87500/-
5 mnths interest comes to Rs. 62500/-

u can get the deduction of 7 mnths interest under self occupied property and 5 mnth interest under letout property

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

nri_123 (Mgr) (29 Points)
Replied 20 July 2012

Originally posted by : M.Varalakshmi
	Divide the interest on loan between 7 mnths and 5 mnths. 7 mnths interest comes to Rs.87500/- 5 mnths interest comes to Rs. 62500/- u can get the deduction of 7 mnths interest under self occupied property and 5 mnth interest under letout property

Thanks.. that makes sense. The actual interest paid in 12 months in PY is 4.5 lakhs. Out of which joint owner (wife) has already claimed 1.5 lakhs. This leaves 3 lakhs / 12 = 25000 PM on an average

25*7=175000 (max allowed is 1.5 lakhs for self occupied)
25*5=125000 (can claim in full as property is let out) so

total deduction 1.5+1.25= 2.75 lakhs

Please confirm if this is what you mean by divinding the interest.

CMA Poornima Madhava (CMA) (13112 Points)
Replied 27 July 2012

if the property is self occupied for part of the year and let out for the part of the year, then the income from the property is taxable as let out property for the whole. Hence you can claim interest without any limit. I don't think you can claim partly as self occupied and partly as let out property in the same PY.

Ruchi Gupta (CA) (52 Points)
Replied 27 July 2012

The House property will be treated as let out for the whole year and rent for entire period of 1 year will be taxable under income from house property.

Interest will be allowed for unlimited amount.