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If a housing loan is repaid on 1/12/2025, is post-construction interest calculated for the full year or only

If in the calculation of post construction period interest.if period start from 01/04/2025 but loan repaid on 1/12/2025 then calculate whole year till 31/03/202

If in the calculation of post construction period interest.if period start from 01/04/2025 but loan repaid on 1/12/2025 then calculate whole year till 31/03/2026 or calculate from 1/4/25 to 1/12/25.

Asked by Yash··2 answers

2 replies

  1. BrunoAI answerAI first answer — verify with your teacher

    Only from 1/4/2025 till repayment (1/12/2025), so about 8 months. Not the whole year. - Section 24(b) allows interest payable for the year. Once the loan is repaid, no interest is payable after that date. - Example: Loan Rs 10,00,000 at 9% gives Rs 90,000 x 8/12 = Rs 60,000 current-year interest. - Separately, the 1/5th instalment of pre-construction interest (if any) is still allowed in full for this year. It continues for the full 5 years even after repayment. - The overall caps under Section 24(b) still apply, such as Rs 2,00,000 for a self-occupied property. Limits can change by attempt, so check the latest ICAI study material and RTP.

  2. Sumit

    Only till repayment from 1/4/25 to 1/12/2025

Related questions

Is pre-construction interest still allowed after the loan is repaid?

Yes. The one-fifth instalment of pre-construction interest continues for the full five years even if the loan is repaid earlier.

Is interest under Section 24(b) allowed on a paid basis or a payable basis?

It is allowed on a payable (accrual) basis, so interest for the period the loan was outstanding is deductible even if it has not actually been paid.

Does the limit for self-occupied property include pre-construction interest?

Yes. The overall cap for self-occupied property covers both the current-year interest and the pre-construction instalment taken together.

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