Please Help: (IT)House property: interest exemption
Posted Date : 24-Jan-2012 , 07:39:35 am | Posted By: VINOD SAHARAN
Category :
Income Tax | Answers :
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Comments :
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Sir,
I am employed in a company. I have avail company accommodation facility as well as I have a house with in 8 km from local GPO (post office distance).
Interest amt on borrowed capital: 165,000/-pa
Income from rent: NIL (being house is vacant)
My query:
1. Whether I have entitled for interest exemption u/s 24, for this house, if yes please clarify with relevant IT section/ rules or case low if any.
2. Can I claim this exemption from my employer OR can my company give me exemption form my salary income.
3. Spouse I have another one house also, for I have paid Rs.200000 interest in that situation what is taxable or exempted for me, please clarify.
Thanking you.
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Answers:
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 Answer by: Lavina Bajaj |
| the deductions under section 24 are exhaustive with the result that the std deduction and interest on borrowed capital no other deduction is allowed from net annual value. interest on borrowed capital is allowed for deduction only if it is availed for acquisition, construction, repair, renewal, or reconstruction of property.
section 23(2)(a)&(b) states that where the property consist of a house which cannot actually be self occupied by the reason of the fact that owing to his employment the annual value of such house shall be taken to be nil.
thus where the annual value of the house is nil the assessee will not be allowed to avail the standard deduction of 30%. however he will be allowed deduction on account of interest as under-
1. property acquired on or after 1.4.99 with capital borrowed and such construction or acquisition is completed within 3 yrs from the end of the financial yr in which the capital was borrowed- actual interest payable subject to max limit of Rs. 150000/-
2. in any other case- actual interest payable subject to max of Rs. 30000/-.
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| Answer by: Vikas Kundu |
| Dear,as u told, your company accommodation shall be taxable as per valuation of perquisites rules (rule 4).secondly, about your first house if it is available for let out but vacant then whole interest of Rs.165000 shall be allowed as deduction u/s 24. but u have not furnished details about second house.
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| Answer by: Mrattunjay |
| For 1: taxble perquisite 1.65 Lacs
For 2: Spouse and you both can get interest benefit up to 1.5 Lacs each as per provision u/s 24 But here 2 lacs whole will be deducted from your income by declaring the document to employer
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| Answer by: Mrattunjay |
| Have u solved your problem or not ? if not please come again, we have some case laws also
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| Answer by: Rambabu Senkarasetti |
| I agree with above answer.
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