What are the Deductions from income from house property?
What are the Amounts not deductible from income from house
property? Section 24 and 25 of
Income Tax Act 1961
Deductions from income from house property and Amounts
not deductible from income from house property are defined under section
24 and 25 of Income Tax Act 1961.
Provisions under these sections are:
of Income Tax Act "Deductions from income from house
24. Income chargeable under the head "Income from house
property" shall be computed after making the following
(a) a sum equal to thirty per cent of the annual value;
(b) where the property has been acquired, constructed,
repaired, renewed or reconstructed with borrowed capital,
the amount of any interest payable on such capital:
Provided that in respect of property referred to in
sub-section (2) of section 23, the amount of deduction shall
not exceed thirty thousand rupees :
Provided further that where the property referred to in
the first proviso is acquired or constructed with capital
borrowed on or after the 1st day of April, 1999 and such
acquisition or construction is completed within three years
from the end of the financial year in which capital was
borrowed, the amount of deduction under this clause shall
not exceed 9[two lakh rupees].
Explanation.—Where the property has been acquired or
constructed with borrowed capital, the interest, if any,
payable on such capital borrowed for the period prior to the
previous year in which the property has been acquired or
constructed, as reduced by any part thereof allowed as
deduction under any other provision of this Act, shall be
deducted under this clause in equal instalments for the said
previous year and for each of the four immediately
succeeding previous years:
Provided also that no deduction shall be made under
the second proviso unless the assessee furnishes a
certificate, from the person to whom any interest is payable
on the capital borrowed, specifying the amount of interest
payable by the assessee for the purpose of such acquisition
or construction of the property, or, conversion of the whole
or any part of the capital borrowed which remains to be
repaid as a new loan.
Explanation.—For the purposes of this proviso, the
expression "new loan" means the whole or any part of a loan
taken by the assessee subsequent to the capital borrowed,
for the purpose of repayment of such capital.
of Income Tax Act "Amounts not deductible from income
from house property"
25. Notwithstanding anything
contained in section 24, any interest chargeable under this
Act which is payable outside India (not being interest on a
loan issued for public subscription before the 1st day of
April, 1938), on which tax has not been paid or deducted
under Chapter XVII-B and in respect of which there is no
person in India who may be treated as an agent under section
163 shall not be deducted in computing the income chargeable
under the head "Income from house property".