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Section-80EEA-Deduction-for-Interest-paid-on-Home-Loan

 

Section 80EEA-Deduction for Interest paid on Home Loan

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Introduction-

Section 80EEA: Deduction for Interest paid on home loan- Union Budget 2019, the Finance Minister has proposed an additional deduction of Rs. 1.50 lakh for interest paid on home loan taken during the financial year 2019-20 for residential house property. This additional deduction of interest will qualify under the newly introduced section 80EEA (First Time Buyer).

Carpet area of the house property should not exceed 60 square meters in metropolitan cities and should not exceed 90 square meters in any other cities or towns.

   
Eligibility-

The deduction is available only to an individual. This deduction is not available for HUF, AOP, Partnership firm, a company, or any other assesse.

 
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Amount of deduction-

This deduction of Rs. 1.50 lakh will be available over and above the deduction of Rs. 2 lakh for interest payment under Section 24 of the Income Tax Act.  Therefore, the taxpayers would be eligible to claim a total deduction of Rs. 3.5 lakh for interest on home loan, if they meet the conditions of section 80EEA and Rs. 1,50,000 under Section 80C.

Particulars

Quantum of Deduction (Rs.)

Self-Occupied Property

Non-Self Occupied Property

Under Section 24

2,00,000

No Limit

Under Section 80C

1,50,000

1,50,000

Under Section 80EEA (Newly Inserted)

1,50,000

1,50,000

   
Conditions for claiming the deduction-

There are certain conditions for claiming this deduction under the newly inserted Section 80EEA and only a person who satisfies all these conditions would be eligible to claim deduction under this section. These conditions are:-

  • Loan has been sanctioned by a financial institution during the period beginning on the 1st April 2019 to 31st March 2020.
  • The stamp duty value of the house property does not exceed Rs. 45 Lakhs
  • The assesse does not own any house property on the date of sanction of the loan (Means First Time Buyer).
   
Deduction in case of Property in the Joint Name-

Property purchased in the joint name and also taken a joint home loan, each person repaying the amount would be eligible to claim whole deduction separately.

 



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