Deduction u/s 80EEA for interest up to 150000 on loan taken for affordable house property
The Union Budget 2019-20 has proposed to insert a new section 80EEA in the Income Tax Act so as to provide a deduction in respect of interest up to one lakh fifty thousand rupees on loan taken for residential house property from any financial institution
The said deduction shall be subject to the following conditions:
(i) loan has been sanctioned by a financial institution during the period beginning on the 1st April, 2019 to 31st March 2020.
(ii) the stamp duty value of house property does not exceed forty-five lakh rupees;
(iii) assessee does not own any residential house property on the date of sanction of loan.
It is also proposed that where a deduction under this section is allowed for any interest, deduction shall not be allowed in respect of such interest under any other provisions of the Act for the same or any other assessment year.
This amendment will take effect from 1st April, 2020 and will accordingly apply in relation to assessment year 2020-21 and subsequent assessment years.
The existing provisions of the section 80-IBA of the Act, inter alia, provide that where the gross total income of an assessee includes any profits and gains derived from the business of developing and building housing projects, there shall, subject to certain conditions, be allowed, a deduction of an amount equal to hundred per cent of the profits and gains derived from such business.
With a view to align the definition of “affordable housing” under section 80-IBA with the definition under GST Act, it is also proposed to amend the said section so as to modify certain conditions regarding the housing project approved on or after 1st day of September, 2019. The modified conditions are as under:
(i) the assessee shall be eligible for deduction under the section, in respect of a housing project if a residential unit in the housing project have carpet area not exceeding 60 square meter in metropolitan cities or 90 square meter in cities or towns other than metropolitan cities of Bengaluru, Chennai, Delhi National Capital Region (limited to Delhi, Noida----------- Similar Posts: -----------