I have purchased under construction flat in Ahmedabad on loan from SBI. Currently I am staying at Pune on rent. I will get possession in last week of March or might be in April. I have below query.
My query is whether i can get tax benefit for both Intrest and principal amount if i will get possession before 31st March.? What if i will get possession after 1st April,as i m already paying EMI for last 6 months.
Interest and principal payment on home loan can only be availed from the year in which possession is received.
If you able to get possession before 31st March, you would be able to claim both principal and interest.
If you get possession after 31st March, you can claim whole interest paid before possession year in five equal installments starting from year of possession. Say, you paid 1 lakh as interest before 2012-13 (possession year), then you can claim 20,000 extra per year starting from 2012-13 for next five years.
I took loan in March-2012 and I am paying EMI from march-2012. Now in march-2013 I got the possession. Can I avail full Interest paid in this financial year itself or it will be 20% Interest for the tax benefit.
You can claim home loan interest benefit from the possession year. So you can claim full interest paid in FY 2012-13 subject to a limit of 1.5 lakh.
You may also claim 1/5th of interest paid before possession year along with this year's interest, but total limit would be 1.5 lakh only.
