The Hindu Business Line : Exemption for more than one housing loan?

How many housing loans are eligible for tax exemption? If an employee owning a residential house constructs a new house with loan, will he get exemption on this also?

Will an employee residing in a rented house and claiming exemption under Section 10 get housing loan exemption for a new house, which he/she is constructing?

S. Elencheran, Madurai

Section 80C contemplates deduction for a residential house.

This shows that at a time one has to choose one house of his choice if he has acquired more than one house with borrowed funds from specified sources.

The deduction is available even if you are getting house rent allowance and living in a rented accommodation.

My builder says that the registration cost is going to rise considerably and, hence, the registration should be done immediately. The flat is only 70 per cent complete. Would registering it now cause any problems if the builder walks away without completing the work?

Srikumar Govinda, email

Your apprehension is quite valid. In property matters it is better to err on the side of caution, and therefore the prospect of paying higher registration charges should not goad you into any hasty action that you may have to repent in leisure.

Education benefit

Can one claim both Section 80C and Section 80E benefit for education?

K.T. Jagatrakshagan, Mayiladudorai

Why not? But the schemes under the two sections are different. While Section 80C offers deduction for tuition fees paid for one's children subject to a maximum of two, Section 80E offers deduction for interest paid on education loans from prescribed sources for one's own benefit or for the benefit of one's spouse and children. Till the last financial year, such interest should have been paid for one's own higher education. Now it can also be for members of family, that is, spouse and children.

Repayment of principal of such loans however continues to fall by the wayside. Thus, if you pay tuition fee of your first child from your income and borrow for the purposes of imparting higher education to the second child, it is possible for you to claim the benefits under both the sections in the manner permitted.

(ASK! Send in your queries to ask@thehindu.co.in.)

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S. Murlidharan

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