Rent exclusion for Housing loan interest

POSTED BY Vignesh EswaraPrasad ON April 25, 2013 7:45 pm COMMENTS (4)


I pay emi for a house whose rent is collected by my parents. I dont enjoy any benefit from the rent. Can I avail full tax benefit from the interest portion of emi?



4 replies on this article “Rent exclusion for Housing loan interest”

  1. Dear Vignesh, here goes the calculation for you.

    A. Gross Rental Income to you = 33000
    B. Taxes paid to local body = 1500
    C. Net rental income = 31500
    D. Standard deduction @30% of C = 9450
    E. Interest paid on home loan = 60000
    F. Income from house property = C – (D+E) = 31500 – 69450 = -37950

    So this -37950 Rs. ‘ll be the loss adjustable to you from your salary income.



  2. Vignesh EswaraPrasad says:

    Thanks for your replies.

    So how that ‘notional’ rent is generally calculated?

    60k py is interest, 33k pm is rent, 1.5k py is local body tax.

  3. Dear Vignesh, can you provide the exact nos. of your query? How much yly rent you are receiving (actually your parents on your behalf)? What’s the interest you are paying to bank for the home loan? What’s the property tax paid to the municipal authorities?



  4. shankaranand says:

    No you cannot. As the house owner it is assumed that the rent is paid to you. It doesn’t matter if you give the rent to someone else.

    Actually even if you keep the house locked, ‘notional’ rent is deducted from your tax benefit.

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