Tax Deductions You can claim on Buying a property

What is 80 c and how is it implied to the home buying

80 c is a section under income tax act which states the tax deductions, exemptions on various types of income sources. This covers various aspects of real estate investments and the tax exemptions can be claimed on them. Try to buy the property form the best builders in Bangalore so that the property will be having proper documentation and you can claim tax on it. 

What are all claimed under 80 c

Under this act we can claim tax on the following charges that are incurred during the purchase of  a property, they are as follows

Registration Fee and Stamp Duty

The Registration fees is eligible for tax exemptions up to 1.5 lakhs under section 80c 

1. You can claim a tax deduction if you are  an individual or a HUF (Hindu Undivided Family).
2. You can Claim the tax in the same Fiscal Year
3. The individual who owns the property should pay the fees himself then only he/she will get the benefit

Instalments of finance - home loan

Home loan repayment is eligible for the income tax exemptions. There are various aspects of home loan repayment such as below

Principle 

The principal amount is eligible for tax deduction up to 1.5 lakhs, 

Conditions that apply for tax deduction

1. The home loan taken should be  for purchase or construction of a new house property.
2. The property should be in possession of owner for  five years from the time you took the ownership. This will add back the deduction and you must have to pay a higher tax on the added income.

Interest

You can claim up to 2 lakhs of income tax deduction on interest paid towards principal amount. This comes with some conditions like

1. The property should be self occupied 
2. The property should be  completed by 5 years with in the loan taken

or else the deduction cap false down to 30,000

First time home buying

Under the section 80EE you can claim an extra tax benefit of 50,000 on the top of all these deductions, This also comes with some conditions like 

The property value must be less than 50 lakhs and the home loan amount must be less than 35 lakhs.

HRA

If you have taken a home loan and staying in the rented home, you can both claim a HRA and Home loan tax exempt at the same time.

Home Renovations

If you had taken a loan for home renovation, you can claim tax only on the interest paid but not the principle, however if you are in a rented house, you can claim the exemption for both. If you are selling the property, you can exempt a tax benefit on the capital gain acquired. For this you should keep a track of all your expenses incurred for home renovations.

Conclusion

These are the tax benefits you can claim on the expenses occurred on home buying such as loan, interest on loan, renovation, and registration process. Comment down below if you feel to add something. click to know the other aspects to be understood  BEFORE BUYING A property in India 

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