Home Loan Interest Payments Under Section 80EEA

ThemostrecentamendmenttotheIncomeTaxActof1961,Section80EEA,givesfirst-time homeownersanexpandedtaxbenefit.Onlythosewhouseahouseloantopurchasea propertyintheaffordablebudgetcategoryareeligibleforthebenefitsofSection80EEA.To collectthebenefits,learnmoreaboutSection80EEA'sfeaturesandexpandedbenefits. Are you searching flats for rent in sion?

ForIndianfirst-timehomebuyers,theCentralGovernment's"HousingForAll"programme hasprovidednumerousuniqueadvantages.TheIncomeTaxActof1961establisheda numberoftax-payingslabsandrequirementsthatcitizensmustadhereto.Oneoftheseis Section80EEA,whichallowshomebuyerstodeductanadditionalRs1.5lakhintaxesoff theloanportionoftheirpurchaseprice.

What does Income Tax Act of 1961 Section 80EEA mean?

Anyfirst-timehomebuyerinIndiaiseligibleforanadditionaltaxdeductionofuptoRs.1.5 lakhunderSection80EEA.ThisdeductionisinadditiontotheSection24standard deductionofRs2lakh.

Who qualifies under Section 80EEA?

TheIncomeTaxActof1961onlyappliestopeopleinthissection.Itisavailabletopeople whoarealreadytakinguseoftaxdeductionsinseveralfields.Companies,firms, partnerships,AOPs,HUFs,andothertypesoftaxpayersarenotpermittedtomake deductionsunderSection80EEA.

What is the Section 80EEA's maximum deductible amount cap?

ThedeductibleamountofSection80EEisthemainpointofintroduction.Theprevious maximumdeductionforinterestpaidtolendingbankswasRs50,000.Now,underSection 80EEA,ahomebuyercanbenefitfromataxdeductionofuptoRs1,50,000.

Notably,theCentralGovernmenthaspermittedthistaxdeductioninadditiontoSection 24(B)oftheIncomeTaxActof1961,whichentitlesacitizentoataxdeductiononahouse loanofuptoRs2lakh.Simplysaid,byadheringtoSections80EEAand24oftheInternal RevenueCode,onemaydeductuptoRs3.5lakhfromtaxespaid(B).

According to Section 80EEA, who are first-time homebuyers?

Youmustnotownanyotherpropertyinyournameinordertobeeligibleforbenefits underSection80EEA.

Imposed restrictions on Section 80EEA

Thisistrueformortgageloansthataresecuredbylendingorganisations(banking &non-bankingfinancialcompanies)

Itonlyappliestofirst-timeresidentialpropertybuyers.

ItshouldbeimplementedandenforcedbetweenApril1,2019,andMarch31,2022.

Theproperty'sassessedvalueforstampdutypurposesmustbelessthanRs45lakh.

Inurbanareasandlargecities,therestrictedcarpetareacriterionis60squarefeet, whereasitis90squarefeetinotherplaces.

Itisapplicabletoprojectsforlow-incomehousingwithapprovalsgrantedafter September1,2019.

Extra benefits provided by Section 80EEA

Forfirst-timehomebuyerslookingtoinvestinanewlocationandaffordablehousing projects,itisahighlydesiredprogramme.Additionally,itisnotstatedinthe80EEA deductionforAY2021–22ifapersonmustresideinaspecificcity.Itfollowsthatonecan purchaserealestateanyplaceinIndia.Inactuality,NRIsmayalsoclaimit(Non-resident Indians).Suchreductionsarealsoavailableforjointpurchases.Ownersmakinginstallment paymentsarequalifiedtoapplyforandreceiveadvantagesunderSection80EEAtax deductionsontheirown.

Section 80EE and Section 80EEA are different.

AtaxdeductionofuptoRs50,000couldberequestedbyfirst-timehomebuyersunderan earlierversionofSection80EEbasedontheinteresttheypaytolendinginstitutions.It appliedtothosewhoappliedforloansbetweenApril1,2016,andMarch31,2017.Youcan usethe80EEdeductionupuntiltheloanispaidoff.

ForconsumerswhotookouthouseloansbetweenApril1,2019,andMarch31,2022, Section80EEAisapplicable.IfownersmeetallrequirementsoutlinedintheIncomeTax Act,theyareeligibletoclaimadeductionofRs1.5lakhundersection80EEA.