Hi
I would like to invite suggestions/comments/feedback from all you learned legal professionals about a doubt regarding my tax implications on housing loan
I have availed of a home loan on an under construction house from SBI. As per the term of the loan scheme, though bank has been disbursing partly for the home which is under construction, bank has started full EMI collection on the whole amount of loan sanctioned from the first day of starting the disbursement (part disbursement). The scheme says, that from the EMI, interest on the disbursed amount would be collected and the remaining would go towards principal repayment. Also, as per the agreement term of the builder with me, the house is supposed to be completed within 24 months.
As per the terms, SBI has also issued a certificate stating the principal and the interest colected from me for the current FY.
Now, my company, as part of investment declaration for the FY for income tax calculation, has asked to submit the proof of the loss from home , in which they have asked to submit the principal/interest deduction statement, only for fully constructed house. I want to know, if I am paying the principal and interest on my ongoing home loan, am I not supposed to get tax benefit on it? Is there any rule which dictates that home loan (principal/interest) can only avail of the tax rebate for a fully constructed house?
I will be higly obliged if you can kindly pour in your valuable views on the same
Thanking you in anticipation
Indrani Chakraborty
From India, Pune
3I would like to invite suggestions/comments/feedback from all you learned legal professionals about a doubt regarding my tax implications on housing loan
I have availed of a home loan on an under construction house from SBI. As per the term of the loan scheme, though bank has been disbursing partly for the home which is under construction, bank has started full EMI collection on the whole amount of loan sanctioned from the first day of starting the disbursement (part disbursement). The scheme says, that from the EMI, interest on the disbursed amount would be collected and the remaining would go towards principal repayment. Also, as per the agreement term of the builder with me, the house is supposed to be completed within 24 months.
As per the terms, SBI has also issued a certificate stating the principal and the interest colected from me for the current FY.
Now, my company, as part of investment declaration for the FY for income tax calculation, has asked to submit the proof of the loss from home , in which they have asked to submit the principal/interest deduction statement, only for fully constructed house. I want to know, if I am paying the principal and interest on my ongoing home loan, am I not supposed to get tax benefit on it? Is there any rule which dictates that home loan (principal/interest) can only avail of the tax rebate for a fully constructed house?
I will be higly obliged if you can kindly pour in your valuable views on the same
Thanking you in anticipation
Indrani Chakraborty
From India, Pune
Dear Sir
Thank you for your reply and clarifying the situation.
However, as you rightly mentioned, that tax exemption qualifies only after possession for the pre-EMI paid during the year of construction(i.e only after actual EMI starts).
However, I would like to emphasize that I have been paying the actual EMI (and not pre-EMI) even for the under construction house. This is as per the loan scheme extended by SBI, wherein the EMI is started from the day of first disbursement of the part payment. All the calculations, i.e interest and principal from the EMI is same as it would have been, had it been a constructed house with full disbursement.
SBI has even issued a certificate stating the EMI amount and the split of the amount into the principal and interest deducted from the same.
Would this scenario qualify for the income tax deduction u/s 80C and 24B?
Please guide me on the same
Waiting for your reply
Thanking you in anticipation
Indrani Chakraborty
From India, Pune
Thank you for your reply and clarifying the situation.
However, as you rightly mentioned, that tax exemption qualifies only after possession for the pre-EMI paid during the year of construction(i.e only after actual EMI starts).
However, I would like to emphasize that I have been paying the actual EMI (and not pre-EMI) even for the under construction house. This is as per the loan scheme extended by SBI, wherein the EMI is started from the day of first disbursement of the part payment. All the calculations, i.e interest and principal from the EMI is same as it would have been, had it been a constructed house with full disbursement.
SBI has even issued a certificate stating the EMI amount and the split of the amount into the principal and interest deducted from the same.
Would this scenario qualify for the income tax deduction u/s 80C and 24B?
Please guide me on the same
Waiting for your reply
Thanking you in anticipation
Indrani Chakraborty
From India, Pune
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