5 THINGS YOU NEED TO KNOW ABOUT THE LAKH TAX BEN­E­FIT ON HOME LOAN

1What

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is the ef­fec­tive sav­ings? An in­di­vid­ual buy­ing a first house can now claim a to­tal de­duc­tion of up to R2.5 lakh on in­ter­est paid un­der sec­tion 24 and 80EE of the IT Act. Ad­di­tion­ally, prin­ci­pal re­pay­ment can be claimed un­der Sec­tion 80C of the IT Act. This will re­sult in a to­tal sav­ing of R30,900.

hap­pens if my to­tal in­ter­est is less than R1 lakh? If in­ter­est for the fi­nan­cial year 2013-14 is less than R1 lakh, the bal­ance can be car­ried for­ward and claimed as a de­duc­tion in the fi­nan­cial year 2014-15.

the new res­i­den­tial house as co-own­ers? If a prop­erty is pur­chased by two peo­ple as co-own­ers, and they sat­isfy all the con­di­tions men­tioned above, each co-owner will be en­ti­tled to the ad­di­tional tax sav­ings un­der sec­tion 80EE.

hap­pens if the wife wants to pur­chase a new res­i­den­tial house? If the spouse has an inde- pen­dent source of in­come, then an ad­di­tional tax break of R1 lakh can be availed, pro­vided the above con­di­tions are sat­is­fied. In case both hus­band and wife are work­ing and earn­ing sep­a­rate in­comes and if there is a house which is al­ready in the name of hus­band, then the wife can pur­chase a house in her name and avail this ad­di­tional tax ben­e­fit. How­ever, the house should be in the name of the wife and also funded by her, oth­er­wise club­bing pro­vi­sions may ap­ply.

point of cau­tion There is no clar­ity on whether the ad­di­tional tax ben­e­fit is avail­able for prop­erty un­der con­struc­tion or not.

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