Income tax guidelines on pre-EMI rebate on dwelling mortgage if property bought earlier than 5 years

Question: I took a house mortgage for a flat and paid pre-EMI in addition to EMI. I’ve been claiming the Pre-EMI rebate for previous 3 years (Aggregate of Pre-EMI curiosity equally distributed in 5 years) in addition to deduction below Section 24(b) and 80C in respect of the EMIs being paid. Now I’ve bought the flat throughout the present 12 months and have repaid your complete mortgage quantity. I wish to know if I can declare the Pre-EMI rebate for subsequent remaining two years after sale of flat?

Answer: Since you’ve got already bought the home in respect of which you have been entitled to assert pre EMI curiosity for the subsequent two years, as no revenue is taxable in respect of the identical home property below the pinnacle Income from House property, your proper to assert the proportionate Pre EMI curiosity for the remaining interval is misplaced ceaselessly and you can’t declare this even in opposition to another home property. However, it is possible for you to to assert proportionate curiosity relatable to the present 12 months as there is no such thing as a provision for decreasing the declare based mostly on the interval for which the property is held throughout the 12 months. so successfully your proper to assert Pre EMI curiosity for one 12 months is misplaced.

Since the home is is being bought inside 5 years from the tip of the monetary 12 months wherein possession of the home was obtained, any rebate claimed by you for the previous three years for reimbursement of principal quantity of dwelling mortgage below Section 80C must be reversed and added to the present 12 months’s revenue. 

Moreover, no deduction below Section 80C is out there is out there throughout the present 12 months in respect of principal quantity of dwelling mortgage repaid throughout the 12 months.

Please be aware that there is no such thing as a comparable provision for reversal of curiosity profit claimed below Section 24(b) prior to now in case one sells the home inside 5 years from taking the possession. Moreover, you’d be entitled to assert the deduction in respect of curiosity paid throughout the 12 months together with the Pre EMI curiosity below Section 24(b).

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