If you are considering taking out a home loan, you must complete this work by March 31. Because after March 31, you will no longer benefit from the additional tax exemption available on the mortgage. In fact, the government had added a new section 80EEA in the Income Tax Act in the budget of the year 2019. Under it, there was an additional tax exemption provision for borrowers home loans to buy affordable homes.
Additional deduction of Rs 1.5 lakh on home loan interest payment
In last year’s budget, an additional tax exemption of Rs 1.5 lakh was announced annually on payment of interest on home loans taken between April 1, 2019 and March 31, 2020. This exemption has now been extended until March 2022. But now the government in its 2022 budget proposal has not carried over this tax relief for the 2022-23 financial year.
The value of the property must be up to Rs 45 lakh
For tax exemption under Section 80EEA, the stamp duty value of the property must be up to Rs 45 lakh. This exemption can only be claimed by a first-time home buyer.
Home loan must be approved by March 31, 2022
If you are looking to buy an affordable home by taking out a home loan, make sure your home loan is approved by March 31, 2022. This is because the additional affordable home tax deduction under Section 80EEA of the Act Income Tax 1961 will not be available as of April 1, 2022.
The home loan can be claimed until completion
Once the loan is sanctioned, one can claim this deduction until the home loan is fully paid off. The Section 80EEA deduction can only be claimed for the purchase of homes. Additionally, this deduction can only be claimed by individual purchasers.