Skip to main content

Home Loan Saving: Study of Tax Section 80EE, 80EEA, and 24B

Image
By


Income Tax Section 80EE, 80 EEA, and 24B

Conversation Between Sunil and Tina

Tina: Sunil, can we buy a new house for ourselves?

Sunil: Yes, however this year I need to invest to claim the tax advantages so we could think the same in the subsequent year.

Tina: It seems that you do not know the tax advantages from the loans opted for the house property.

Sunil: Is it?

Tina: Yes

Sunil: Just tell me what would be the tax advantages of the housing loan?

Tina: Let me provide you with an overview then we would go towards each provision after that.

Sunil: I am listening

Tina: House loan repayment comprises two portions 1. Principle and 2. Interest repayments

  • Principal repayments get deduction u/s 80C up to 1,50,000
  • Interest repayments get deduction u/s
    • 24(b) up to 2,00,000 in case of self occupied
    • 80EE Maximum – 50,000
    • 80EEA Maximum – 1,50,000

Sunil: This is unimaginable we could save from a housing loan then what is the requirement to invest in the others.

Tina: Do not enjoy obtaining these deductions we require to satisfy some of the conditions, let's see these.

Sunil: let's begin

Tina: Under section 80C, a taxpayer would claim the principal payment as the deduction and stamp duty, the enrollment fee, and the additional expenses concerned with the buying of the new house.

Tax Deduction for Interest Payments Available U/S 80EEA, 80EE, and 24B:

Income Tax Section 80EE:

Conditions:
  • The loan must be carried in the p.y 2016-17.
  • Value of house ≤ 50,00,000.
  • Loan ≤ 35,00,000.
  • The taxpayer would not pose any additional house property.
  • The loan must be from a financial institution.
  • Maximum deduction – 50,000.

Income Tax Section 80 EEA

Conditions:
  • The loan must be taken between the years 2019-2022. 2. Stamp duty value ≤ 45,00,000.
  • Stamp duty value ≤ 45,00,000.
  • No limit would be there on the loan.
  • Maximum deduction 1,50,000.
  • The loan must belong to the financial institution.

Income Tax Section 24B

Conditions:
  • No limitation would be there on the loan value and the value of the property.
  • The loan would belong from any source (e.g: the loans via relatives, friends etc)
  • The classification of loan can be of any form personal loan, business loan etc but used for the construction or buying of house property.
  • There would be no condition on the existing house property
  • However, the max deduction permitted for the self-occupied property would be Rs 2,00,000 along with all the properties.
Tina: Now you get it?

Sunil: Yes, though I have some questions?

Tina: Ok, fire me?

Sunil: This is concerned with the 24(b) section. If I avail of a loan as joint property is a deduction of 2,00,000 for both?

TIna: NO, each co-owner would obtain 2,00,000 deductions.

Sunil: Loan through the relatives would be permitted in 24(b) could we obtain the cash loan?

Tina: Yes, but up to 20,000 as some additional sections pose the penalties on cash loans of more than 20,000.

Sunil: if house property is used for let out purpose in this case also we will get a maximum of 2,00,000 as a deduction?

Tina: No, there is no limit towards the case of let out as per the conditions like construction needs to be finished prior to 5 years.

Sunil: Under sections 80EE & 80EEA the deduction time limits we already lose, thus if we initiate it now we could take only deduction u/s. 80C & 24(b) is it right?

Tina: Yes, You are right.

Sunil: Thank you, Tina.

Comments

Post a Comment

Popular posts from this blog

Check Summary of 2023 MCA Amnesty Scheme for LLP e-Forms

By
The discussion shall take place for "Latest Amnesty Scheme introduced by MCA in relation to Limited Liability Partnership". A General Circular No 08/2023 Dated: 23rd August 2023- Subject- Condonation of Delay in filing of Form-3, Form 4, Form 11 u/s 68 of LLP Act, 2008 is been issued by the MCA.  MCA has acknowledged that they've received numerous complaints regarding technical glitches on their website and discrepancies in the master data. These issues have prevented Limited Liability Partnerships (LLPs) from submitting the LLP-3, LLP-4, and LLP-11. In order to facilitate a more business-friendly environment, the MCA is utilizing its authority under Section 67 of the LLP Act, 2008. They have decided to grant a one-time relaxation in additional fees and any related penalties for delayed filing of the aforementioned three forms, as elaborated in this article. However, one aspect of this initiative raises some confusion. Why hasn't the MCA included Form LLP 8 in this a
Post a Comment
Read more

All Special Features of Gen I-T Software with Downloading Steps

By
Gen IT is one of the income tax software created by professionals from SAG Infotech Pvt. Ltd. This software helps to compute Income Tax, Interest Calculations, Advance and Self Assessment Tax. The software is created with high quality-perfection to prepare returns. It also provides e-filing to upload returns with the help of the software. This software is proficient in calculating Income Tax, Advance, Interest Calculations, and Self Assessment Tax. The quality of the software is very high as the returns are prepared by it. The software provides the facility to file and upload returns. Also, there are simple steps to download the free download Gen IT software for the trial version. To complete the processes, the Gen Income Tax returns filing software has 2 different sections which include - Client Manager, Income Tax, Billing, AIR, Calculator, Backup/Restore, Password and Printer Settings, Bulk SMS/E-Mail and Help. These operations are explained briefly below- 1. Client Mana
Post a Comment
Read more

All About Advance Tax Payment Rule Under IT Act, 1961

By
A tax expert answers the question- ‘the requirements of advance tax provisions under the Income-tax Act 1961’. Advance tax, as the name itself indicates that the tax paid by individuals in the financial year when the corresponding income is earned, rather than in the assessment year when the income is assessed for taxation purposes. This payment is calculated based on the consolidated income earned and expected to be earned from various sources, such as salary, rent, interest, and more. It takes into account applicable deductions, exemptions, and credits for taxes deducted at source (TDS) or taxes collected at source (TCS). According to section 208 of the Income Tax Act, 1961, individuals whose estimated tax liability for the year amounts to Rs. 10,000 or more are required to pay advance tax. However, senior citizens aged 60 years or above who are residents and do not earn any income from business or profession are exempt from paying advance tax. Typically, advance tax payments are ma
Post a Comment
Read more