Interest & 80C Deductions Allowed to Non Residents Too!

shankers_1999@......com Asked : I was NRI and working in DUBAI till Dec 14th 2007 ( Went to Dubai in 26th July 2003). Returned back to India on 15th Dec 2007 and joined an MNC here. I have 2 question for filing my Income tax return,( FY 2006-2007)

* a) I am paying interest on Housing loan amounting to Rs 72076/- for the full year of 2006-2007 & principal Component of Rs 39944/- for the full year 2006-2007. Can i take the full interest component of the whole year for deduction and exemption for computation of Income tax or only on prorata basis of 3Months and 14 days ?

* b) LIC Policy premium also should i consider for the full year 2006-2007 or only for the prorata period of 3 Months 15 days?

The interest as deduction of expense is allowed to all who has borrowed loan for construction of a house which is assessable under the head "Income from House Property". The residency status does not effect the taxation of the house property situated in India. Therefore, if a Non Resident has property assessable under the I T Act , shall be allowed Deduction of Interest u/s 24 of the I T Act. Therefore, as far as interest of Rs 72076 shall be allowed in your case. You should read this

The deduction u/s 80C of the I T Act of Principal Amount and LIC premium is subject to restriction that it can not exceed Gross Total Income and that maximum allowed is Rs 1,00,000. Exact wording of the provision contained in Section 80C simply states that the deposit should b