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Jul,31,2025, 14:00 hrs
Can you claim HRA and home loan benefits both?
Balwant Jain , Tax and Investment Expert
guest: My husband and I took out a joint home loan on Jun-22 for an under-construction house. We have now got possession of the house in June 2025. We have been paying pre-EMI so far. We stay in a rented accommodation and plan to shift to the new house in April 2026. For the current financial year 2025-2026, can we claim tax benefits on the pre-EMI amount, in addition to the tax benefit on rent paid.
:
You can claim full tax deduction benefits in respect of interest paid during the year in which you take the possession of the under construction property. Therefore, in your case the entire interest payable for the financial year ended March 31, 2026 (including the interest payable from April 2025 till the date of handover of possession in June 2025) is fully deductible under Section 24. In addition to the interest paid during the financial year 2025-2026 you can claim 1/5th of the pre EMI interest paid/payable till March 31, 2025. You can claim HRA provided you have actually paid rent. Claim of HRA is not linked with claiming tax benefits on home loan. I would suggest you that you make the new house in a liveable condition and actually stay there for a few days before March 31, 2026. This will ensure that it is treated as a self occupied property and the annual value is taken as nil.
guest: I am a government employee residing in a rented house, paying rent of Rs.99000 P.A. I put my own house on rent in the same city, getting rent of Rs 72000 P.A. Paying Housing Tax of Rs.4000 P.A. and getting HRA 120000 P.A. My wife, a homemaker, is co-owner/ borrower of our house as well as Home Loan, but only I am paying Home Loan EMI and availing Interest benefits U/s 24(b). 1. What would be my tax implication and 2. Can I avail HRA exemption?
:
What you are doing is perfectly legal. Tax benefits for home loan are available to a person who is an owner/joint owner as well as borrower/coborrower. The tax benefit is available in the ratio of your share in the home loan which may be different than your share in the property. Since you alone are servicing the home loan, you alone can claim the tax benefits for the home loan. As far as claim for HRA is concerned, one has to satisfy three conditions. Firstly you should be paying rent and are in receipt of HRA from your employer for the house occupied by you and not owned by you. Since you satisfy all these conditions, you can claim home loan benefits as well as HRA benefits.
guest: I got possession of my house on 8th March 2025. The property is on my as well as my mother`s name, however all the loan repayment is done by me alone. As I live currently in another rented house, can I claim both HRA as well as tax benefit on housing loan principal and interest? I want to give my house on rent but it is still not occupied by any tenants, can I still claim tax benefit? If yes, shall I declare it under the Self occupied section or let out section of the declaration form? In case I give the property on rent, and all the income from rent is taken up by my mother? Can I skip the income from house property in my ITR because my mother is taking up all the income?
:
There is no restriction on your claiming HRA while claiming tax benefits in respect of home loan as long as you are satisfying the conditions laid down under Section 10(13A) and 80C and 24(b). Even if the house is not let out yet, you can show it as self occupied as a tax payer is allowed to have two self occupied properties. The rental income shall be taxable in your hand as well as in your mother’s hand in the ratio in which you own the property. The rent can just not be shown in your mother’ hand as you both are owner of the house.
guest: I have taken a housing loan. The property is in the name of my father and I am the only son. I am the applicant for a housing loan and my father is the applicant and am paying the complete EMI for the house. The house is self-occupied by me and my father. Sale deed does not comprise my name. My company is not accepting Housing Loan exemption for income tax since I am not the owner.so I am showing HRA for tax exemption. My question is while filing IT returns, whether I can bring HRA as a taxable one and bring my housing loan for exemption and apply for refund. (Can I claim tax benefit under 80C (Principal) and Interest can be claimed as a deduction under Section 24. claim up to Rs. 2,00,000 or the actual interest repaid whichever is lower).
:
Since the house is in the name of your father, you can not claim the home loan benefit even if you are an applicant and servicing the home loan. One has to a an owner or co-owner to be able to claim the tax bene-fit in respect of home loan taken by him and serviced by him.
guest: A residential flat is inherited by 2 daughters (A & B, 50% each). Daughter A is currently residing in the flat. Since it is a family matter & also on humanitarian grounds no compensation is being given by daughter A to B for using the flat. Now daughter A’s son wants to claim HRA benefit in his personal tax return & is therefore paying rent to his mother (A). However, the flat belongs to both A & B. Should not the rent amount be split into 50% & shown as income in both the daughters personal tax returns?
:
Yes, You are right. The rent of a property accrues to the owners in their respective ownership ratio. Had the flat not fetched any rent B could have treated the flat as self-occupied but in case it is let out even partly the rent has to be apportioned between both the legal owners.
guest: I am a salaried person. I have invested in two properties in two different cities one at my home town and another where I am working. Construction is completed of both but not occupied by me. I am paying EMIs for both the properties. My family is residing in my home town in my parents` house. I am paying rent to my parents for which I am receiving a rent receipt. Can I claim tax benefit on Two home loans and HRA benefit simultaneously?
:
There is no restriction as regards claiming of HRA and tax benefits in respect of home loan simultaneously as long as you satisfy the conditions applicable for the respective provisions. For claiming the benefit of HRA what is required is that the employee himself should be paying rent for the house occupied by him. Since you yourself are not staying in that house, you would not be eligible to claim HRA benefit even if your family is staying there. For the house which are completed you can claim deductions under Section 80 C and 24b if the same are in your possession and you have opted for old tax regime.
guest: I am currently staying on rent. We (joint owner with spouse) purchased a flat in Rajasthan last year and are currently paying EMI for the joint loan. We got possession of the flat in Feb 2025. Can we claim HRA for the financial year 2024-25 & also take housing loan benefits also. If yes, then what should be the category in ITR1 – self occupied/let out? Is there any provision for such a case when the house is not on rent & nobody is staying there?
:
There is no restriction on a tax payer claiming simultaneously deduction for HRA in respect of rent paid as well as for interest and repayment of principle amount of home loan as long as conditions specified in Section 10(13A) and 80C read with Section 24b are satisfied. As your Rajasthan house is not let out you can treat it as self occupied though not actually occupied by you and claim both the deductions provided you opt for old tax regime. Since the possession was obtained during the year, deduction for interest and repayment both can be claimed for the whole year including 1/5 of the aggregate of interest paid prior to the year of taking possession.
guest: I work and live in a rented accommodation in Gurgaon. I have Purchased a flat in Kolkata where my parents stay and the loan is almost paid (2 more years, so very little interest to be paid). I now purchased and possess another flat at Ghaziabad, where I cannot stay due to the distance from my office. I am planning to keep it locked for the time being. Now what will be my tax implication considering, I pay EMI for the 1st flat (occupied by my parents), EMI for 2nd flat (no occupancy) and pay rent in Gurgaon.
:
You can claim HRA benefit if you are in receipt of HRA from employer and staying in a rented place not owned by you. A person is allowed to have maximum of two properties as self-occupied. You can treat both your houses as self-occupied. You will be able to claim interest upto Rs. 2 lakhs for both the houses taken together. Moreover you will be able to claim deduction under Section 80 C for repayment of home loan upto 1.50 lakh for both the flats taken together along with other eligible items provided you opt for old tax regime.
guest: I have invested in a new house by taking a Home loan in 2022. The project is stuck and possession is awaited. I don`t know when I will get possession. However, I am paying EMI on a home loan from 2023. Since, project is stuck, I have to stay in rented premises. The Project is nearly 8-9 kms from my rented house and falls under the same local authority. Can I claim HRA and home loan benefit as I am paying both EMI & Rent?
:
Benefits in respect of home loan are available from the year in which you get the possession of the house. Since the house in respect of which you are paying EMI is not yet completed you can not claim any deduction for the EMIs paid under Section 80C and 24(b). However as you are paying rent for the house, you can claim HRA benefits.
guest: An official living in a rented house in Delhi and paying home loan Emi for a flat in Gugoan (Haryana) that is locked and not rented. Can he claim the tax benefit on housing loan EMI and HRA rebate on rent paid?
:
Yes, one can claim both the benefits provided conditions for eligibility to claim deduction are satisfied independently. The locked house can be treated as self occupied house as one is allowed to have maximum of two houses as self occupied for income tax purposes.
guest: I got possession of my house in April, 2025. I currently live in another rented house. Can I claim both HRA and tax benefits on a housing loan for the whole year? I intend to let out my house though not occupied by any tenants presently. Can I still claim tax benefit on a home loan? If yes, should I declare it as self-occupied or let out in my ITR form.
:
Answer: There is no restriction on you claiming HRA while claiming tax benefits in respect of home loan as long as you are satisfying the conditions laid down under Section 10 (13A) and 80C and 24(b). Since you are paying rent for the house in which you are staying and which is not owned by you, you can claim the HRA benefit. As you are planning to let out the property and in case you are able to do so before 31st March, you can show this property as let out and claim the tax benefits in respect of interest paid under Section 24(b) and for repayment of home loan under Section 80 C upto Rs. 1.50 lakhs along with other eligible items. The tax benefits for home loan are available for the full year in which possession of the property is taken. So you will be able to claim the benefits of HRA and home loan for the full year as you intend to stay in the rented house for the whole year. The income tax laws allow a person to have maximum of two houses as self-occupied so even if you are not able to let out your house before 31st March, you can show it as self-occupied and I do not think there should be any problem as long as this house is not actually let out during the year. Once you start letting out the house, you can claim vacancy allowance for the period during the year when it cannot actually be let out.
guest: I am a senior citizen, I along with my mother and bachelor son, live in a house which is in the name of my father who expired three years ago. The property has not been transferred so far due to family circumstances. How can my son who is employed in a Private Ltd. Co., can claim HRA benefit by giving rent ? To whom can he give rent to claim HRA benefit ?
:
I presume your father did not make a will so in absence of the will the house is inherited by your mother and you in equal part unless you have any other siblings in that case they will also have an equal share. So your son can claim HRA by paying rent to you and your mother.
guest: We husband and wife both are salaried employees. If we take a joint loan and buy an apartment which we will own jointly, then can We both avail the tax benefit of principal repayment as well as for interests? If it is a self-occupied house, then can I also pay rent for another property in the same city and claim HRA?
:
Yes, you are right. If you and your husband both are co-owners of the property you both can get tax benefits for the home loan repayments as well as for interest payments in the ratio of your respective shares in the loan. Tax benefits will be available for each of you separately under section 24 (interest payable on the loan) limited to Rs 2 lakhs each if property is self-occupied and under section 80 C of Rs 1.50 lakh (for the principal repaid) as per the ratio of the loan. You can also claim exemption for HRA for actually paying rent to stay in a rented house not belonging to you. Which city the rented house is in will not make any difference to claim the exemption. What is important is that you should be able to prove that you are actually paying the rent for the house that does not belong to you and which is occupied by you. However, in my opinion it will be difficult for you to treat one self owned house as self-occupied and claim another house as taken on rent for self-occupation unless it is genuine.
guest: If I buy a property on loan and rent it to my parents and I stay in another house owned by my parents and pay rent to them, am I eligible for tax exemption on loan (principle full Interest amount) and HRA tax benefits also.
:
Yes. You can claim both the benefits. You can claim HRA benefits if you are in receipt of HRA from your employer and paying rent for accommodation occupies by you and which is not owned by you. There are no restriction under the tax laws against tax payer claiming HRA and home loan benefit simultaneously.
