Benefits of tax exemption for house loan recipients As of right present, you may get tax exemption up to ₹ 5 lakh on interest. What's the latest?

Benefits of tax exemption for house loan recipients As of right present, you may get tax exemption up to ₹ 5 lakh on interest. What's the latest?

Union Budget for 2024–2025 Date: The Confederation of Real Estate Developers Association of India (CREDAI) is requesting an expansion of the tax exemption program for house loans. The current cap on the amount excluded from paying home loan interest is Rs 2 lakh. The amount need to be raised to Rs 5 lakh.

Union Budget for 2024–2025 Date: The nation's general budget preparations are well underway. Why not? Before the election season, this is the final budget of the Modi administration 2.0. Even if this is just temporary, our expectations of you remain the same as always. In order to attract voters, the government may also introduce new initiatives and provide incentives like tax breaks. For this reason, the real estate industry also expects Nirmala Sitharaman, the Finance Minister, to soar. The demand for house loan tax exemptions has been made. In addition to the general public, or taxpayers, the real estate industry is anticipated to gain significantly from this as well.

Up to Rs 5 lakh in tax deduction upon house loan repayment

The scope of the tax exemption on house loans should be expanded, according to the Confederation of Real Estate Developers Association of India (CREDAI). The current cap on the amount excluded from paying home loan interest is Rs 2 lakh. The amount need to be raised to Rs 5 lakh. According to CREDAI, interest rates are quite high. Reducing repo rates till the second quarter of 2024 is a difficult task. EMIs for house loans have been directly impacted by this. Monthly EMI payments for purchasers of homes must be increased. They stand to gain if they are granted a tax exemption in this scenario.

Section 80C of the Income Tax Exemption

Following the repayment of the principal amount of a house loan, an income tax deduction of up to Rs 1.5 lakh is available. Stamp duty and registration costs may also be included, although they may only be subtracted once per year from the total amount paid. Only new home construction or acquisition should be funded by home loans.

Remark: The tax deduction you have already earned under Section 80C will be added to your income in the year that you sell your home if you do so within five years of buying it.

Section 24(B) of the Income Tax exempts home loan interest payments from taxes.

Up to Rs 2 lakh in tax exemptions are available for house loan interest payments. The residence for which the loan has been obtained, regardless of whether you now reside there or not. You will not, however, be eligible for a tax deduction if you rented that residence.

Real estate demand will rise.

Exempting house loans from taxes would provide middle-class homeowners more money to spend, and it will encourage others to purchase real estate. "Demand is necessary for growth in the sector and demand will increase only whenever taxpayers are given some benefit in tax exemption," according to CREDAI Chairman Manoj Gaur. Furthermore, the amount of house loans has been continuously rising. There has been a noticeable rise. The need for housing won't rise even if things stay constant. Consequently, the government will only be able to exempt taxpayers. The industry won't be able to get up steam until then.

How may I get a house loan tax exemption?

Tax reduction is offered on house loan repayments under Section 24 of the Income Tax Act. EMI is divided into two sections. A portion of the principle and another of the interest. A tax exemption of Rs 2 lakh is granted under Section 24(B) on the interest part of a financial year. The primary part is eligible for the Section 80C deduction, up to a ceiling of Rs 1.5 lakh.