Nirmala Sitharaman, the Financial Minister, presented the first Union Budget of the Modi government on 5 July. FM has proposed an additional tax deduction of Rs 1.5 lakh on interest paid on housing loans which are taken up to March 2020. The government aims to boost the affordable housing sector by introducing the new Section 80EEA.
According to Section 24 of the Income Tax Act, 1961, previously, a taxpayer would get a deduction of up to Rs 2 lakh on interest paid on home loans. With the inclusion of the new Section 80EEA under the Act, a taxpayer will qualify to get a maximum tax deduction of Rs 3.5 lakh upon meeting the pre-set conditions which are applicable.
Also Read: Government plans to usher the electric vehicle sector
The additional Rs 1.5 lakh tax deduction on home loans will be available to individuals under the following circumstances:
Also, a few conditions about the carpet area have been mentioned in the memorandum of the finance bill but not specifically in the finance bill, 2019. The following are the conditions in relation to the carpet area of house property:
Financial experts are of the opinion that the new additional tax deduction will be beneficial to homebuyers in smaller towns/tier-2/tier-3 cities. However, the benefit will be limited to homebuyers residing in metro cities considering the higher real estate rates.
Bhavana is a Senior Content Writer handling the GST vertical. She is committed, professional, and has a flair for writing. When away from work, she enjoys watching movies and playing with her son. One thing she can’t resist is SHOPPING! Her favourite quote is: “Luck is what happens when preparation meets opportunity”.
The systematic investment plan (SIP) contribution in February 2024 has crossed a new milestone. The monthly contribution tipped at Rs…
The Income-Tax (I-T) Department has directed taxpayers to access the Annual Information Statement (AIS) via the e-filing official portal and…
Considering the vagaries of the stock market, investors often ponder over reevaluating their strategies. Whether to continue to remain invested…
Financial planning is beyond just investing wisely to save on taxes; it's also related to protecting oneself and one's loved…
A salaried individual earning up to Rs 5-15 lakh as net salary on an annual basis must first take stock…
Equity-linked savings schemes (ELSS), also referred to as tax-saving schemes, are equity funds that invest a significant portion of their…