If you purchase an under-construction property by taking a home loan, the Income Tax Act makes provisions for under construction home loan tax benefits. … 1.5 lakhs) as a tax deduction under section 80C of the ITA.
Can I get tax benefit on under construction property?
Home Loan Tax Benefits for Under-Construction Property
A home loan for an under-construction property can get tax deductions up to Rs. 2 lakhs on the interest paid in a year and up to 1.5 lakhs for any principal paid under Section 80C of the Income Tax Act.
Can we claim principal be claimed before possession?
Deduction on Principal repayment
The Principal portion of the EMI paid for the year is allowed as deduction under Section 80C. The maximum amount that can be claimed is up to Rs 1.5 lakh. But to claim this deduction, the house property should not be sold within 5 years of possession.
How do I claim pre-construction interest in income tax?
The total amount of pre-construction interest and interest on a housing loan that can be claimed in a year should not exceed Rs 2 lakh in any case. The deduction for this interest is allowed in 5 equal instalments starting from the year in which the house is purchased or the construction is completed.
Is construction loan eligible for tax exemption?
Under Section 24 of the Income Tax Act, you can claim deductions on the interest component of your home construction loan. In the case of self-occupied property, the maximum deduction allowed is Rs. 2 lakhs. … Before taking a loan to avail this exemption, it is ideal to calculate your home loan eligibility online.
Can you claim interest during construction?
Generally, you claim interest charges on a loan for the construction of a rental property as deductible expenses in the year that the interest charges are incurred, even if your construction hasn’t finished.
What is 80EEA exemption?
Amount of deduction
A deduction for interest payments up to Rs 1,50,000 is available under Section 80EEA. This deduction is over and above the deduction of Rs 2 lakh for interest payments available under Section 24 of the Income Tax Act. Read more about the deduction of Rs 2 lakh on interest on home loan here.
How many home loans are eligible for tax exemption?
Even under the income tax laws there are no restrictions on the number of houses for which you can claim the tax benefits for home loan. One can treat only two houses as self-occupied and have to offer notional income in case more than two houses are self-occupied for such extra self-occupied houses.
Can I claim income tax exemption on home loan without possession?
You will be able to claim the interest for whole of the year irrespective when you get the possession. A person is allowed to have maximum of two property as self occupied but aggregate of interest on home loan under Section 24(b) is restricted to two lakh whether you have one self occupied property or two.
Can husband claim it benefit on Wife property?
Yes, husband can claim ownership of property bought in wife’s name provided the funds used for buying the property is from known sources and legal.
Can I claim both 80EE and section 24?
Section 80EE and Section 24
If you are able to satisfy the conditions of both Section 24 and Section 80EE of the Income Tax Act, be quick to claim the benefits. First, exhaust your deductible limit under section 24, which is Rs 2 lakh. Then go on to claim the additional benefits under section 80EE.
What is the difference between 80EE and section 24?
The deduction under Section 80EE can only be claimed by individual taxpayers on properties purchased either singly or jointly. … The deduction that can be claimed is above and beyond the limit of Rs. 2,00,000, as under Section 24 of the Income Tax Act. The property can be either self-occupied or non-self-occupied.
What is standard deduction u/s 24 A?
Section 24 of the Income Tax Act lets homeowners claim a deduction of up to Rs. 2 lakhs (Rs. 1,50,000 if you are filing returns for last financial year) on their home loan interest if the owner or his family reside in the house property.