Tax Benefits on Ready Possession Homes Are Persuading People Away From Under-Construction Homes
27 Oct 2016
Ready-to-move-in houses are becoming the most preferred choice for home buyers. It makes sense given the widening trust deficit between developers and buyers.
If this wasn't bad enough, the number of tax benefits that a buyer enjoys from ready-possession homes only sways them away from under-construction projects.
Here's why ready-to-move-in houses score massively over under-construction ones as far as tax benefits are concerned:
1) Deductions on home loan interest
As per Section 24(b) of the Income Tax Act, If you have possession of your home, then interest paid on the home loan is eligible for deduction of up to Rs. 2,00,000.
2) You could lose 85% tax benefit with under-construction homes
Availing tax benefits for under-construction homes can be a tricky task, mainly due to the uncertainty that is commonly associated with it.
The tax benefit of Rs. 2 Lac per year can only be claimed if the construction is finished within three years from when the loan was granted. Otherwise, the buyer can claim up to only Rs. 30,000 as benefit.
3) Benefit on principal repayment
As per Section 80C of the Income Tax Act, you can claim up to Rs. 1 Lac on the principal paid. However, under-construction homes are not entitled to principal repayment of a home loan.
4) Exemption from tax on capital gains
Whenever you sell your house, the gains that you receive are unfortunately taxed, which amounts to a very large sum of money. However, Section 54 of the Income Tax Act allows you to circumnavigate this if you invest the gains in another residential house property. Bear in mind, the purchase of new property must be done within three years of the transfer of old property.
With such huge tax benefits, along with other financial gains available for ready-to-move-in houses, why not explore our numerous ready-possession projects?
Explore Goel Ganga Developments here http://www.goelgangadevelopments.com