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Tax Benefits

Tips for tax claims


 
 

Interest

The interest component in the EMI can be claimed as deduction, if the house one has bought, is through EMIs. The year in which the construction of the house is completed, is when one can claim this deduction.

Stamp duty and registration

Payment made towards stamp duty and registration charges are also allowed to be claimed under Section 80C, besides the deduction allowed on principal repayment. However, the year in which these were paid, is the only time these can only be claimed.

Under Section 80EE

For a house valued at Rs. 40 lakh or less and the amount of loan taken Rs 25 lakh or less, This section can provide tax benefit to first time home owners. The loan should have been sanctioned between April 1, 2016 to March 31, 2017, to be able to claim this deduction.

Principal

Under Section 80C of the Income Tax Act, one can claim the component of your EMI which goes towards principal. One can sum up the outgo for the year towards principal and claim it. Under Section 80C, one can claim a maximum of Rs 1.5 lakh as deduction.

Pre-construction

You can also start claiming pre-construction interest from the same year in which the construction is completed, while deduction for interest can be claimed starting the financial year. One can claim it in five equal installments; post adding up the entire pre-construction interest. However, when the house is being used by you for your own residence, the total deduction should not exceed Rs. 2 lakh.