As we all are aware that, Section 80EE and Section 80EEA are two important sections which will give opportunity to the tax payers to claim additional deduction for housing loan interest over and above Section 24. This is very good initiative for tax saving for the common man.
Today in this article we will see the details of these two sections. So let’s start the discussion:
a) Section 80EE – Deduction in respect of interest on loan taken for residential house property.
Deduction amounting to Rs 50,000 is allowed in addition to deduction under section 24(b).
- The loan should be sanctioned between 1st April 2016 – 31st March 2017.
- The value for the property should not exceed Rs 50 lacs and the sanctioned loan amount should not exceed Rs 35 lacs.
- The purchaser should be a first time home buyer also this is applicable only in case of residential house property.
- The benefit will be applicable till the time of repayment of loan continues.
b) Section 80EEA – Deduction in respect of interest on loan taken for certain house property.
Additional deduction amounting to Rs 1,50,000 is allowed in addition to deduction under section 24(b).
- The loan should be sanctioned between 1st April 2019 – 31st March 2021.
- The stamp duty value of the house should not exceed Rs 45 lacs.
- The carpet area of the house should not exceed 60 sqmtr in metro cities and 90 sqmtr in other cities.
Only the individual is allowed to claim the deduction under this section provided he does not own any other house property.
Relevant Extract of Section 80EEA and Section 80EEB:
Section 80EE – Deduction in respect of interest on loan taken for residential house property.
(1) In computing the total income of an assessee, being an individual, there shall be deducted, in accordance with and subject to the provisions of this section, interest payable on loan taken by him from any financial institution for the purpose of acquisition of a residential property.
(2) The deduction under sub-section (1) shall not exceed fifty thousand rupees and shall be allowed in computing the total income of the individual for the assessment year beginning on the 1st day of April, 2017 and subsequent assessment years.
(3) The deduction under sub-section (1) shall be subject to the following conditions, namely:—
(i) the loan has been sanctioned by the financial institution during the period beginning on the 1st day of April, 2016 and ending on the 31st day of March, 2017;
(ii) the amount of loan sanctioned for acquisition of the residential house property does not exceed thirty-five lakh rupees;
(iii) the value of residential house property does not exceed fifty lakh rupees;
(iv) the assessee does not own any residential house property on the date of sanction of loan.
(4) Where a deduction under this section is allowed for any interest referred to in sub-section (1), deduction shall not be allowed in respect of such interest under any other provision of this Act for the same or any other assessment year.
(5) For the purposes of this section,—
(a) “financial institution” means a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies, or any bank or banking institution referred to in section 51 of that Act or a housing finance company;
(b) “housing finance company” means a public company formed or registered in India with the main object of carrying on the business of providing long-term finance for construction or purchase of houses in India for residential purposes.
Section 80EEA – Deduction in respect of interest on loan taken for certain house property.
(1) In computing the total income of an assessee, being an individual not eligible to claim deduction under section 80EE, there shall be deducted, in accordance with and subject to the provisions of this section, interest payable on loan taken by him from any financial institution for the purpose of acquisition of a residential house property.
(2) The deduction under sub-section (1) shall not exceed one lakh and fifty thousand rupees and shall be allowed in computing the total income of the individual for the assessment year beginning on the 1st day of April, 2020 and subsequent assessment years.
(3) The deduction under sub-section (1) shall be subject to the following conditions, namely:—
(i) the loan has been sanctioned by the financial institution during the period beginning on the 1st day of April, 2019 and ending on the 31st day of March, 2021;
(ii) the stamp duty value of residential house property does not exceed forty-five lakh rupees;
(iii) the assessee does not own any residential house property on the date of sanction of loan.
(4) Where a deduction under this section is allowed for any interest referred to in sub-section (1), deduction shall not be allowed in respect of such interest under any other provision of this Act for the same or any other assessment year.
(5) For the purposes of this section,—
(a) the expression “financial institution” shall have the meaning assigned to it in clause (a) of sub-section (5) of section 80EE;
(b) the expression “stamp duty value” means value adopted or assessed or assessable by any authority of the Central Government or a State Government for the purpose of payment of stamp duty in respect of an immovable property.
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(Republished with Amendments by Team Taxguru)
I have taken loan on 2016 for 35 lakhs for under construction building and took possession on 2018.
I opted for home loan transfer to another bank in 2018. Will I be still eligible for 80EE and claim the interest paid on the PRE-EMI ?
I took loan from my friend and paid Rs 36000/- interest every year. can I claim interest under sec 80EE.
please advice me…
Sir ,
I have taken home loan rs. 15lakh in oct 2016 for purchasing a flat In financial year 2017-18 interest component is 129234 and principal component is 38903 . N value of my house is less than 50 lakh . Can I claim the benifit of 80ee ?
I have taken loan of Rs. 27 Lakhs from canfin home loans for purchase of Flat, will am be to take a deduction of 50,000 under 80EE, can some one confirm on the this
Sir ,
I have taken home loan rs. 1350000 in July 2016 for construction of a house . Construction completed in march 2017 . In this financial year 2017-18 interest component is 123464 and principal component is 37303 . Nvalue of my house is less than 50 lakh . Can I claim the benifit of 80ee ?
sir
home loan is rs 33,80,000=00 in 2016-17 FY sanctioned house value is 45 lacs
may i claim 50,000 rs in 2017-18 u/s80EE
PLEASE answer
Hello sir,I am taking loan in March 2018.I am eligible for section 80EE or not.please suggest.
how much claim can be avail in section 80c and section 24
Hi,
kindly advise on what loan sanctioned period should be for claiming 80EE if we are claiming it in F.Y. 2017-18.
Sir, I took loan in16-17 for construction of house in own plot. Can I avail tax deduction u/s 80ee ? All other conditions are fulfilled u/s 80ee.
Sir
I have taken housing loan from LIC for the construction of house, in my own plot. Can I claim for the rebate of interest u/s 80EE for the construction of house ?I would like to mention here that I complete all other conditions for the same. Please reply soon as early as possible
regards
my homeloan was sanctioned in august 2016 and is under 35L and propery value is as per the limit specfied..however, the property is still under construction..can i claim the deduction of interest paid of rs 50000 ?
Hi, i have bought a flat & registered on Dec 1, 2015 and i have taken 21 lac loan, will am be to take a deduction of 50K under 80EE, can some one confirm on the this
Purchased property in the name of spouse and loan sanctioned in both name i.e. husband and spouse, payment of loan and interest made by husband . Who is eligible to claim deduction u/s 80 EE ?
Value of Flat : 49,60,000.00+ST(3.75%)+VAT(1%)
Parking : 2,50,000.00+ST(3.75%)+VAT(1%)
Plus registration & other misc charges.
Loan Amount Rs 35,00,000.00
Kindly clarify me whether I can claim deduction under section 80 EE.
I have a confusion on whether Value of residential property inclusive of Service Tax, VAT, Parking Fee & other statutory dues or not.
My home loan was sanctioned for 355000 for an under construction property but during the current financial year 3349000 was disbursed and rest amount will be disbursed at the last demand of the builder at the time o possession in April 2017 .Since Amount disbursed is less than 35 lakh in financial year 2016-17 ,am i eligible to get 50000 rebate .Loan sanctioned on 12 April 2016
My home loan was sanctioned for 355000 for an under construction property but during the current financial year 3349000 was disbursed and rest amount will be disbursed at the last demand of the builder at the time o possession in April 2017 .Since Amount disbursed is less than 35 lakh in financial year 2016-17 ,am i eligible to get 50000 rebate .Loan sanctioned in 12 April 2016
No; only registration charges incurred for the residential property qualify for deduction U/s 80C
if a person buying residental property and pay home loan interest above 300000 can they avial deduction in Sec 80EE and how much amt. claim?
Can we claim tax deduction for the amount paid as brokerage while buying apartment?