Amit Agrawal (Sr. Consultant) 23 May 2011

Claiming HRA/House Loan Interest

Hi All,

I am a salaried person and eligible for HRA. I have recently purchased a house and will be getting the possession of the same soon. I am planning to move-in to my own house by 1st October 2011. I am in rented accomodation currently.

My query is regarding claiming HRA as well as House loan interest for FY12. Since I will be paying house rent for first 6 months of FY and my home loan EMIs have already started, can I claim HRA for first 6 months and house loan interest exemption for next 6 months.

Also, both the houses (rented and owned) are in same city.

Just to clarify, I dont want to claim both the exemptions for the same months. It would be HRA claim for Apr-Sep and HL interest for Oct-Mar.

Can anyone please help me out for identifying whether the above arrangement is allowed?

Thanks

Amit Agrawal

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2 Replies

CA VK Dwivedi (Job) 23 May 2011

Hi Amit, till the time construction is not completed and you do not shift to your house you can claim HRA and HL Intt both. once you take possession of your flat then only Intt will be allowed as deduction and will not be eligible for HRA deduction.

Shayan Khan (B.com) 23 May 2011

For the purpose of claiming the deduction of interest on Loan on SOP, the property should be registered in your name. Unless the Possession/Ownership is not tranfered, u can claim the exemption of HRA under sec 10(13A).

Moreover, once the ownership is transfered, u may also claim the pricipal amount of loan as deduction under sec 80C as well.