I purchased a residential flat in 2013 (under-construction property) and paid instalments towards the same as per the payment plan. I took a home loan in December 2017 and was paying Pre-EMI (interest only) since the flat was under construction. However, I started the EMI payment since January 2023.

OC for the building was received in April 2023 but builder still delayed the possession and finally gave me possession of the flat in April 2024. 

As I have been paying the interest since December 2017 and the EMI since January 2023, can I claim rebate for the amount I have paid now since I have got the possession of the flat? If so, how much, and what are the applicable rules?

Sandeep Prakash

Income-tax law allows deduction for interest paid on capital borrowed for construction/purchase of house property. Interest paid before EMI payment can be deducted in five equal instalments from the financial year in which the possession was taken for the property.

As your loan was taken in December 2017, if the property’s completion certificate is dated March 2023 (though received in April 2023), then you are eligible to pre-construction interest as deduction from income in five equal instalments starting from FY 22-23. Total claim of deduction under Section 24(b) is limited to ₹2 lakh.

Interest certificate issued by the lender for each financial year, loan statements/certificate and Completion certificate need to be maintained.