Section 22
Section 22: deductions from income from house property
Section 22 sets out the two deductions allowed while computing income from house property - a flat 30% standard deduction on the annual value, and a deduction for interest on borrowed capital used to acquire, construct, repair, renew or reconstruct the property, including a special rule for pre-construction/pre-acquisition interest.
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The two deductions
Section 22(1) allows the following deductions in computing income from house property:
- 30% of the annual value determined under section 21 - a flat standard deduction
- Interest payable on capital borrowed for acquiring, constructing, repairing, renewing or reconstructing the property
- Interest payable for the period before the tax year in which the property was acquired or constructed ("pre-construction interest"), claimed in five equal instalments starting from the tax year of acquisition/construction and the following four tax years
Cap for self-occupied property (section 21(6) cases)
For property covered by the self-occupied nil-annual-value rule in section 21(6), the aggregate interest deduction under section 22(1)(b) and (c) is capped at:
| Condition | Cap |
|---|---|
| Property acquired/constructed with borrowed capital, with acquisition/construction completed within 5 years from the end of the tax year the capital was borrowed, and a certificate of interest payable is furnished | ₹2,00,000 |
| Any other case | ₹30,000 |
Other rules in this section
The pre-construction interest deduction under section 22(1)(c) is computed after reducing it by any amount already allowed as a deduction under any other provision of the Act (section 22(3)).
The certificate mentioned above must specify the interest payable on the capital borrowed, and the interest payable on any new loan taken to repay the original borrowed capital (section 22(4)).
Where an assessee has more than one self-occupied property under section 21(6), the aggregate deduction across all such properties under section 22(2) cannot exceed ₹2,00,000 (section 22(5)).
Interest chargeable under this Act but payable outside India is not deductible under this section if tax has not been deducted/paid on it under Chapter XIX-B and there is no agent in India for it under section 306 (section 22(6)).
Frequently asked questions
What is the standard deduction for house property income?
A flat 30% of the annual value as determined under section 21 - this applies regardless of the property's actual maintenance expenses.
What is the maximum home loan interest deduction for a self-occupied house?
₹2,00,000, if the loan was for acquisition/construction completed within 5 years of borrowing and a proper interest certificate is furnished; otherwise the cap is ₹30,000. The overall cap across all self-occupied properties under section 21(6) is ₹2,00,000.
Can I claim interest paid before I actually acquired or built the house?
Yes - pre-construction/pre-acquisition period interest is deductible, but spread equally over five tax years starting from the year of acquisition or completion of construction.
Related sections
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Talk to our tax team about this sectionLast updated 9 September 2026