When Home Loan EMI for Apt under construction can be used for Tax rebate.

  1. I have Purchases an Apartment that is under construction and possession will be given after 18 months. (in the same city where I live: Bangalore)
  2. I have taken Home Loan for the same.
  3. 30% of the Property amount has already been paid to the Builder (20% self:10% bank).
  4. Rest of the payment(s) will happen as an when construction completes next phase(s).
  5. So it might take 12 months do the complete payment.
  6. For me, bank has fixed PreEMI (only interest) for first 6 months and after that actual EMI (interest+ principal) would start.

Now my doubt is from when I can start availing Income Tax rebate on the amount I am paying as PreEMI and later EMI.

I searched but I did not get clear idea when my EMI becomes eligible for tax rebate:

  1. Is it from the day I start paying EMI to the Bank, for my case it’s 6 months from now.
  2. Or is it from the day full payment is done by bank to the builder, ie 12 months from now.
  3. Or is it when I get the registration done.
  4. Or is it when I get possession and I actually start staying there, for my case 18 months from now.

I am expecting that I can avail HRA till I get possession of my house.

asked Apr 08 '12 at 01:58 by IT_Developer 1222

You can claim income tax benefit for home starting from the year in which you get the possession.

All interest paid before possession year can be claimed in five equal installments starting from possession years in five years. But total interest benefit cannot exceed 1.5 lakh for self occupied house (including previous year's portion).

answered Apr 09 '12 at 18:30 by Pankaj Batra 5.2k320


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Asked: Apr 08 '12 at 01:58

Seen: 2,736 times

Last updated: Apr 09 '12 at 18:30