Pre EMI Tax Benefit Doubt

POSTED BY Reji m ON May 27, 2013 8:01 am COMMENTS (10)

I’ve booked an apartment, the expected delivery time is 2 years. During this time, approximately I would be paying 8.5 Lacs as interest. I am hoping to close this loan just after registration. So if the loan is closed can I claim the pre emi interest (8.5/5=1.7 per year) in 5 installments? 

10 replies on this article “Pre EMI Tax Benefit Doubt”

  1. Reji m says:

    Thanks Ashal

  2. Dear Reji, as the construction period is starting from now, the dates are very important for you. Please consult a Tax professional in your case.



  3. Reji m says:

    I will sell the property before the registration.

  4. Ashish Garg says:


    As far as I understand, repaying home loan using the long term capital gains will not be considered as invested in the real estate and you may end up paying capital gains tax on the earnings. Also I think your selling of the old property would be later than the registration date of the current/new property.


  5. Reji m says:

    The new property cost is 90L, I am taking a 70L loan. I am expecting 65L from my old home. Capital Gain is approximately 16L. The total loan amount is still higher than expected sale price of my old home. Ashal do you see any issue here?

  6. Dear Reji, yes, make your calculation perfect to avoid any last minute surprises.



  7. Reji m says:

    Ashal, I hope you are referring to capital gains tax, if you invest this amount in a new property then we don’t have pay any tax right?

  8. Dear Reji, what about the tax liability on the sell proceeds of old property?



  9. Reji m says:

    I’ve another property, I will sell that once this new flat is ready. The proceeding from the sale, I will use it for closing the loan.

  10. Dear Reji, the answer is yes. But my counter question is, why do you want to close the loan immediately after registration?



Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.