Amit Agrawal (Sr. Consultant) 16 April 2010
Hello Experts,
I have recently foreclosed my home loan by prepaying the full balance amount. I paid around 2.21% penalty (2% penalty + 10.3% Service tax on penalty amount) on outstanding prnciple amount to foreclose the loan. My question is, can this penalty amount be considered as Loss from house property (as the HL interest) and be deducted from my taxable income?
Thanks
Amit Agrawal
CA Adarsh Agrawal (CMD of SHAYVIDZ Group) 16 April 2010
| Originally posted by :Amit Agrawal | ||
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Hello Experts, I have recently foreclosed my home loan by prepaying the full balance amount. I paid around 2.21% penalty (2% penalty + 10.3% Service tax on penalty amount) on outstanding prnciple amount to foreclose the loan. My question is, can this penalty amount be considered as Loss from house property (as the HL interest) and be deducted from my taxable income? Thanks Amit Agrawal |
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Amit ! the penalty amount cannot be claimed as deduction under IHP. Only Interest on borrowed capital can be claimed as deduction.
Even Interest on unpaid interest is not allowed as a deduction under IHP. [ SHEWKISAN BHATTER 89 ITR 61 (SC)]
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