I purchased a flat in December 2013 and started paying the pre-EMI from February 2014 on the housing loan. I was paying the pre-EMI until September 2014 and started paying the EMI from October 2014.
The construction was completed in January 2015 but I can get the flat registered in my name only in March. I am now staying in a rented house.Online GST Certification Course by TaxGuru & MSME- Click here to Join
Can I get exemption u/s 10(13A) for the house rent allowance as well as for the pre-EMI interest and EMI? – Sharavanan B.
If you have receipts of house rent allowance and if you are paying rent, exemption u/s 10(13A) will be available. Section 24, which allows a deduction in respect of interest on capital borrowed for purchase/construction of a house property, permits this deduction for the interest that relates to the previous year in which the property is acquired or constructed.
The interest prior to the year when the property was acquired or constructed is to be claimed in five equal annual instalments beginning from the year when the property is purchased or acquired.
In your case, the interest for February and March 2014 relate to the year before the year when the property was acquired.
The interest of these two months will have to be claimed in five equal annual instalments beginning from Financial year 2014-15 (assessment year 2015-16). The interest for April 2014 to September 2014 and also the interest from October 20014 to March 2015 can be claimed in full in 2014-15(assessment year 2015-16).