If you are looking to buy an affordable house by taking a home loan, this is the right time to apply 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.
In a relief to middle-class people, the Union Finance Minister in Budget 2020 had proposed an additional deduction up to Rs. 1.5 lakhs for Interest paid on Loans taken for an affordable house extended till 31st March, 2021.
For the realization of the goal of Housing for All and affordable housing, an additional deduction of up to one lakh fifty thousand rupees for interest paid on loans taken for the purchase of an affordable house was announced in last year’s budget.
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.
Apart from above said benefits, Homebuyers can also avail benefits 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 Income Tax Act.
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