Are you among those who are looking to buy an affordable house by taking a home loan? Hurry up and get your loan sanctioned before March 31, or else you will loose benefit of Rs 1.5 lakh available under the affordable housing segment.
The additional tax deduction available for affordable housing under Section 80EEA of the Income Tax Act, 1961 will not be available from April 1, 2022.
In the Union Budget 2022-23, the government has done away with this tax break, which was available for financial years 2019-2022.
Homebuyers can avail two key deductions under Section 24 (b) and Section 80C of the Income Tax Act.
Under Section 24(b), the deduction on the interest component can go up to Rs 2 lakh. Under Section 80C, borrowers can avail a tax benefit of up to Rs 1.5 lakh on the principal amount.
Over and above the Rs 2 lakh deduction under Section 24(b), borrowers are allowed to claim an additional deduction of Rs 1.5 lakh under Section 80EEA for the interest paid on a home loan.
So, if you avail an affordable housing loan before March 31, you can claim a maximum deduction of Rs 3.5 lakh for the interest paid, using Section 24 and Section 80EEA of the I-T Act.
To claim the benefit, the following conditions should be met:
- Housing loan must be taken before March 31, 2022;
- The stamp duty value of residential house property should not be more than Rs. 45 lakh;
- You should not own any residential house property on the date of sanction of loan.
Ms Kalinga