From April 1, 2022, the central government is going to discontinue income tax benefits under Section 80EEA of the Income Tax Act for first-time home buyers.
In Budget 2021, Union Finance Minister Nirmala Sitharaman had extended income tax benefit under Section 80EEA till 31st March 2022, allowing home buyers to claim income tax exemption up to Rs 1.50 lakh.
If the value of the house property is less than Rs 45 lakh, then you can claim income tax exemption of up to Rs 1.50 lakh in home loan interest payment.
But in Budget 2022, this benefit hasn’t been extended which means new home buyers will have to pay more income tax from the next financial year that starts from April 1, 2022.
Can you get tax benefits under Sec 80EEA even in the next FY?
Yes. If a taxpayer is mulling to buy a home in the next financial year, s/he can still avail of this income tax benefit. What the home buyer need is to get its loan approved in the current financial year (before Mar 31, 2022) and buy a home in the next financial year.
It is worth noting that in order to claim deduction under Section 80EEA, you should not own any other house property on the date of the sanction of a loan.
