8/10/2019 Tax Deduction_home Loan

1/3

Particulars Section 24 Section 80C

Tax Deduction allowed

for Interest Principal

Basis of Tax Deduction Accrual basis Paid basis

Quantu of Tax

Deduction allowed

Self Occupied Property: Rs.

2,00,000

!on Self "ccupied Propert#$ !o %iit&s' ()*0)000

Purpose of %oan

Purc+ase, Construction, &epair, &enewal,

&econstruction of a &esidential -ouse

Propert#'

Purc+ase , Construction of a new

-ouse Propert#

.li/ibilit# for claiin/

Tax deduction

Purc+ase, Construction s+ould be

copleted wit+in #ears !il

&estriction on Sale of

Propert# !il

Tax Deduction claied would be

re1ersed if Propert# sold wit+in *

#ears

57[ Deductions from income from house property.

24. Income chargeable under the head Income from house property shall be

computed after making the following deductions, namely:

a! a sum e"ual to thirty per cent of the annual #alue$

b! where the property has been acquired, constructed, repaired, renewed

or reconstructed with borrowed capital, the amount of any interest

payable on such capital:

Provided that in respect of property referred to in sub-section (2

of section 2!, the amount of deduction shall not e"ceed thirty thousand

rupees :

Provided furtherthat where the property referred to in the first pro#iso is

ac"uired or constructed with capital borrowed on or after the %st day of &pril,

%''' and such ac"uisition or construction is completed 5([within three years

from the end of the financial year in which capital was borrowed), the

http://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn57div1s24.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/section23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn58div1s24.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/section23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn58div1s24.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn57div1s24.htm

8/10/2019 Tax Deduction_home Loan

2/3

amount of deduction under this clause shall not e*ceed one lakh fifty

thousand rupees+

Explanation.here the property has been ac"uired or constructed with

borrowed capital, the interest, if any, payable on such capital borrowed for

the period prior to the pre#ious year in which the property has been ac"uiredor constructed, as reduced by any part thereof allowed as deduction under

any other pro#ision of this &ct, shall be deducted under this clause in e"ual

installments for the said pre#ious year and for each of the four immediately

succeeding pre#ious years:)

5'[Provided also that no deduction shall be made under the second pro#iso

unless the assessee furnishes a certificate, from the person to whom any

interest is payable on the capital borrowed, specifying the amount of interest

payable by the assessee for the purpose of such ac"uisition or construction of

the property, or, con#ersion of the whole or any part of the capital borrowed

which remains to be repaid as a new loan+ Explanation.-or the purposes of this pro#iso, the e*pression new loan

means the whole or any part of a loan taken by the assessee subse"uent to the

capital borrowed, for the purpose of repayment of such capital+)

5.[#nnual value how determined.

2!. %! -or the purposes of section //, the annual #alue of any property shall be

deemed to be

a! the sum for which the property might reasonably be e*pected to let fromyear to year$ or

b! where the property or any part of the property is let and the actual rent

recei#ed or recei#able50by the owner in respect thereof is in e*cess of the

sum referred to in clause a!, the amount so recei#ed or recei#able$ or

c! where the property or any part of the property is let and was #acant during

the whole or any part of the pre#ious year and owing to such #acancy the

actual rent recei#ed or recei#able by the owner in respect thereof is less than

the sum referred to in clause a!, the amount so recei#ed or recei#able :

Providedthat the ta*es le#ied55by any local authority in respect of the property shall

be deducted irrespecti#e of the pre#ious year in which the liability to pay such ta*es

was incurred by the owner according to the method of accounting regularly employed

by him! in determining the annual #alue of the property of that pre#ious year in which

such ta*es are actually paid by him+

Explanation.-or the purposes of clause b! or clause c! of this sub1section, the

amount of actual rent recei#ed or recei#able by the owner shall not include, sub2ect to

http://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn59div1s24.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn53div1s23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn54div1s23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn55div1s23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn59div1s24.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn53div1s23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn54div1s23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn55div1s23.htm

8/10/2019 Tax Deduction_home Loan

3/3

such rules53as may be made in this behalf, the amount of rent which the owner cannot

realise+

(2 $here the property consists of a house or part of a house which%

(a is in the occupation of the owner for the purposes of his own

residence& or (b cannot actually be occupied by the owner by reason of the fact that

owin' to his employment, business or profession carried on at any other

place, he has to reside at that other place in a buildin' not belon'in' to

him,

the annual #alue of such house or part of the house shall be taken to be nil+

(! he provisions of sub-section (2 shall not apply if%

(a the house or part of the house is actually let durin' the whole or any

part of the previous year& or

(b any other benefit therefrom is derived by the owner.0! here the property referred to in sub1section /! consists of more than one house

a! the pro#isions of that sub1section shall apply only in respect of one of such

houses, which the assessee may, at his option, specify in this behalf$

b! the annual #alue of the house or houses, other than the house in respect of

which the assessee has e*ercised an option under clause a!, shall be

determined under sub1section %! as if such house or houses had been let+)

http://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn56div1s23.htmhttp://law.incometaxindia.gov.in/dittaxmann/incometaxacts/2005itact/ftn56div1s23.htm