Housing Loan – Tax Exemption of interest of pre-construction period

Interest Payable by an assessee in respect of funds borrowed for the acquisition or construction of a house property and pertaining to a period prior to the previous year in which such property has been acquired or constructed, to the extent it is not allowed as a deduction under any other provision of the Act, will be deducted in five equal annual instalments, commencing from previous year in which the house is acquired or constructed.

Pre-construction period means the period commencing on the date of borrowing and ending march 31 immediately prior to the date of completion of construction /date of acquisition or date of repayment of loan, whichever is earlier.

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