Financial Daily from THE HINDU group of publications
Sunday, Sep 25, 2005
Financial Daily from THE HINDU group of publications Sunday, Sep 25, 2005 |
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Investment World
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Income Tax Columns - Tax Talk Rebate on prepaid loan T. Banusekar
I HAD taken a loan in 1998 to purchase a flat. I have paid the full amount of the outstanding loan by way of prepayment in March 2005. Can I claim tax rebate on the principal and deduction in respect of interest which is comprised in the prepayment in financial year 2004-05? Now that I have repaid the full loan, can I get the benefit of claiming exemption in respect of HRA on rent payable for a property which is co-owned by my wife and me? Niteen Reply The principal which has been repaid in the financial year 2004-05 will qualify for rebate under Section 88 in that financial year, that is, assessment year 2005-06. The rebate, however, will be subject to the limits prescribed in the section. Under Section 88, the amount that will qualify for rebate in respect of the principal repayment of housing loan cannot exceed Rs 20,000. The interest relating to the financial year 2004-05 can also be claimed in that year. If you are living in the house that is co-owned by your wife and you, it may not be possible for you to claim exemption under Section 10(13A) in respect of the HRA, given that you would not be paying any rent for occupying the house.
Mail your queries to taxtalk@thehindu.co.in or by post to Tax Talk', Business Line, Kasturi Buildings, 859, Anna Salai, Chennai-600002.
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