Everybody has some of the other expectations from the budget of the country. So know the facts about real estate taxes & benefits!!
Let us see whether the latest proposal of the budget in favor of the Real Estate industry is helpful or not.
As per the union budget 2019-20, there is an additional tax benefit of Rs. 1.5 lacs on home loans.
This is in addition to the benefit of Rs. 2 lacs under section 24(b). The total benefit would be Rs 3.5 lacs.
There are some important points which need to be understood in the context of real estate taxes, to avail the complete benefit of this proposal.
These points can also be considered as the precautions which people need to understand so that they can be at an advantage with the provisions of the real estate budget.
You need to understand the conditions along with this additional tax benefit.
As per the union budget 2019-20, there is an additional tax benefit of Rs. 1.5 lacs on home loans.
This is in addition to the benefit of Rs. 2 lacs under section 24(b). The total benefit would be Rs 3.5 lacs.
There are some important points which need to be understood in the context of real estate taxes, to avail the complete benefit of this proposal.
These points can also be considered as the precautions which people need to understand so that they can be at an advantage with the provisions of the real estate budget.
Value of the house, not exceeding 45 lacs
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First and foremost, one needs to understand that the value of the house should not exceed Rs. 45 lacs.
This amount should be as per the stamp duty ready reckoner that is published by the state government of the place of property.
If you are planning to buy a house that exceeds this amount, you may not be able to avail of these real estate taxes.
The role of stamp duty reckoner is the most important one here.
You may definitely claim the tax benefit for the house that exceeds this amount of Rs. 45 lacs but you need to make sure that the amount as per the stamp duty reckoner must not exceed this limit.
For your information, ready reckoner is the kind of rate or price of the property of all kinds.
These prices are published by the State Governments. These rates are revised every year.
Only from April 1, 2019, to March 31, 2020
This additional tax benefit is available for a limited time period.
It is only for the home loans which would be sanctioned between April 1, 2019, and March 31, 2020.
You need to note that it is irrespective of the date of actual disbursement of the loan.
Not only the disbursement of the loan, but also of the date of purchase or booking of the home.
It means that if you have booked a piece of property before April 1, 2019; there is still scope for you explain this benefit proposed by the 2019 budget.
You need to make sure that you satisfy all the other important conditions.
The only financial institution, only banks
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According to real estate budget, the tax benefit of Rs. 1.5 lacs is available only for those people who take home loans from a financial institution.
As per the legal definition of a financial institution, only banks fall under this category.
It means that you will not be able to take a loan from Housing Finance Companies or any other non-Banking Finance Companies.
You need to cross-check this point when the bill of real estate budget gets completely passed.
No other property
The borrower who wants to claim this additional tax benefit, should not have any house in his name. You don’t need to feel depressed about it.
This has to be followed only on the date of sanction of the home loan.
You can also shift your property in the names of your family members.
This is how you can continue to avail of the real estate tax benefit.
For an under-construction property
There is a tax benefit of Rs. 2 lacs under section 24(b). The new tax benefit has been introduced under section 80 EEA.
As per the previous provision, it is only possible to claim the interest if the construction has been completed and The Possession has been taken.
But according to the latest provision, it is possible to claim the benefit and apply for the loan also during the construction period.
It is not necessary that the construction must be completed according to 2019 budget.
We hope that this article has helped you give a better inside into the real estate budget of 2019.
This has given important highlights with respect to the latest proposal of real estate taxes.
It is an attempt to understand whether the benefit shown by the provisions of the budget exists truly or not.
