Check out some similar questions!

vineet_chattree · Jan 23, 2007, 10:44 PM

Hi

I am Vineet Chattree, working with a TATA group.

I purchased a flat in Chembur in December 2005. At that time builder declared 80% completion from Bank. However, I decided to start with EMI in place of pre-EMI based on 80% slab.

Builder promised to give accommodation by June 2006, but slipped on time lines and now he has committed April 2007. I will get possession letter then only.

I have obtained the provisional certificate from bank stating the principal and interest deducted for the financial year 2006-07.

Also I am staying in company provided accommodation.

My question is :

For year 2006-07 can I claim income tax benefit for the interest and principal ?

I am confused with the statement given in income tax law about pre-EMI (pre-construction/ pre-acquisition) where one has to take the benefit in installments spread over five years on interest

Thanks, will appreciate early answer.

AtlantaTaxExpert · Jan 24, 2007, 11:05 AM

Vineet:

Chembur is in India, which indicates that you are asking a question about Indian Tax Law.

This forum is for United States tax law.

I doubt that anyone can answer your questions on this forum. I know that I cannot!

Sorry!

sachinkundaliya · Mar 12, 2008, 07:29 AM

There are two types of deduction pre construction and post construction.

You will be able to get pre construction only after the completioin of the house and your five installment will be counted after this period- from date of borrowing to 31/3/FY (which comes first as compare to your date of completion) ex- 1-4-2000 to 31-3-05 if your house completed on 25-5-05.

Post construction is for outstanding balance of loan as on the Financial Year.

Interest part will be deducted under the House Property and Principal part would be deducted under section 80C.