Affordable housing projects are given a deduction under Section 80IBA of the Income-Tax Act.
If you are keen on buying a house in an affordable housing project but have held off so far, you’ve got another chance to benefit from the extra tax concessions available on loans of such projects.
Finance Minister Nirmala Sitharaman
on Monday proposed to extend the Rs 1.5-lakh benefit on interest paid on affordable housing loans by one year — till March 31, 2022.
The upper limit is capped at Rs 45 lakh for claiming this deduction.
According to Kamal Khetan, chairman and managing director at Mumbai-based Sunteck Realty, “This move will certainly prompt more demand, especially among first-time buyers.”
Arvind Hali, managing director and chief executive officer at Motilal Oswal Home Finance, added: “This announcement will prompt those who had delayed their property purchases to act now.”
Anuj Puri, chairman, Anarock Property Consultants, said the extension of tax holiday to developers by another year will bring in fresh supply into this segment.
Affordable housing projects
are given a deduction (equal to 100 per cent of profits or gains from development of affordable housing) under Section 80IBA of the Income-Tax Act.
Deduction under this section has also been allowed to rental housing projects notified by the central government.