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Treatment of home loan interest when one has 2 properties - one rented and one self occupied

Tax queries 144 views 3 replies

Anjaneyulu Kuchibhotla

7 Points Joined July 2018

I have 2 properties:

1. Property 1 - Rented out and obtaining rent. No existing home loan

2. Property 2 - Self occupied. Home loan taken

In ITR2, when I show the rent on Property 1, do I need to restrict the interest on the loan on Property 2 to 2,00,000 or am I am allowed to show the full interest that I am paying and claim that as loss against the rent I am receiving on Property 1 for computing Income tax.

A;so was there any difference on how this was treated last year as compared to this year.

Replies (3)

Sarath Rajendran

Nil

2791 Points Joined November 2017

For a self occupied property housing loan interest deduction limited to 2,00,000 only

And avail maximum 150000 for principle amount repaid ( 80C)

Anjaneyulu Kuchibhotla

7 Points Joined July 2018

Thanks for the response.

So I understand that the interest limit for self occupied property is 2,00,000/- even if you have another property where you are earning rent without a loan.

Sarath Rajendran

Nil

2791 Points Joined November 2017

You can hold any number of house property , But as per Income tax act you can show only one house property as your "SELF OCCUPIED HOUSE". and claim Interest on loan if you have any loan on this property. ( Maximum - Interest up to 2,00,000 and Principle repayment 1,50,000 (80 C) for each financial year up to loan closing )