Business loan or a home loanbusiness loan or a home loan to owna flat to put on rent
Apnaloan.com Research Bureau
10 Aug 2007
I took a home loan from HDFC bank. During the year 2005-2006, the interest paid by me was about Rs.2, 00, 000. I told my CA that I would be renting out the house and file a claim for the entire interest exemption in I-T return. He says that if the house is to be put on rent, I should have taken a business loan and not housing loan; he says that he can claim Rs. 1, 50, 000 only.
The requirement for deduction of interest payable on a loan is only that it should have been taken to acquire or construct a house property. The nomenclature of the loan (whether a business loan or a home loan or even a completely unsecured personal loan) is completely irrelevant for the purpose of claiming deduction under Section 24. The only requirement is that, you must be able to prove that the loan is taken for the purpose of construction or acquisition of a house property.
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