Owning a home is one of the happiest moments one can think of and literally, everyone has it on their bucket list, left to be complete at some point in time. Well, we bear glad tidings for you if are intent on buying a home. Guess what. Now you can tick owning a home off your bucket list. By buying a home, you can herald in access to numerous tax benefits that come along.
Here are a few that you might want to know about...
Tax-free profits
You can't avail this trait until after you sell your first home to invest in a new one.
Other prerequisites demand that you must have lived in the house in question for at least 2 years and it must have been your permanent residence. If you're single your gains are tax-free up to ₹ 2 crores. However, if you happen to be married, this sum is upped to ₹ 4 crores.
Stamp duty
Section 80C explicitly claims that the public can avail of a deduction in registration fees and stamp duty. However, the most prominent con in this context is that the deduction can't exceed ₹ 1.5 lakhs. On the brighter side, this is quite a relieving amount provided the interest rates and expenses incurred on houses.
Benefits of a second home loan
If you loan a certain amount from a bank registered under RBI to own a second home, you will have access to the following benefits:
. In accordance with the current provisions, tax benefits can be relished with payable interest, too. The Income tax act, 1961 states that the total amount of interest can be reclaimed.
. New policies taken by the government have demolished national rent levied on second properties, previously known as let-outs. Now even such properties can be deemed self-occupied.
Deduction for mortgage insurance
Do you pay for monthly mortgage insurance? Yes? Now you're eligible for having reduced mortgage insurance. Something to be noted is that you can qualify to avail this only if your gross income doesn't exceed ₹ 90 lakhs.
State and local taxes deduction
Another tax benefit you can avail is the deduction for SALT, under which property taxes fall as well. The amount deductible is ₹ 8 lakhs approximately. Here’s how this actually works -- if you're a homeowner paying around ₹ 6 lakhs but your property taxes are ₹ 5 lakhs, you will able to deduct around ₹ 2.5 lakhs of a tax bill.
Deduction for home office
If you own an office at home or one at a place you rented, you may be eligible for this deduction. In order to be eligible, you must ensure that your house has been regularly used as an office. Besides, you must provide concrete documents that prove your house has been the headquarter for your business.
Deduction for property tax
One of the greatest con a homeowner faces is that they are forced to pay a yearly property tax based on documents and assessments done by the government. The maximum amount a taxpayer can deduct is around ₹8 lakhs. This helps provide some respite from federal income taxes.
Residential credit on energy-replenishing homes
If your home is energy-efficient, you're more than eligible for this benefit. If you're purchasing a new home, all you need to do is have the masonry build your house in a way that makes you eligible.
These updates/settings encompass insulation, solar panels, energy-efficient windows and door, geothermal heat pumps, skylights and so on.
These were some of the tax benefits attributed to purchasing a home it's just scraping the surface because there are more tax benefits that you can easily avail little to no hindrances. These benefits will allow you to unburden your tax-related worries to an extent. So... what are you waiting for? If you're on the lookout for a new home, make sure to try availing the aforementioned tax benefits.
prestige marigold
