The best way to have tax benefit- Property Investment.

Udit, Faridabad

17th February 2015

Real estate News in Delhi

real estate investment

buying property

property investment

housing loan

tax benefit

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Replies (4)

Hi,
The Budget 2015 has been discharged within which several tax laws connected proposals were created by the finance minister. Some realty trade participants are in their favour and a few feel they'll impact the property buyers pocket. These embody, termination of wealth tax, additional deduction u/ 80CCD of Rs 50,000 (this is over and above the Rs 150,000 deduction available) on NPS contributions, company tax rate to be reduced to 25 per cent over next 4 years from the current 30 per cent, increase in commission tax to 14 per cent from 12.36 per cent.

Kalki K,

17th March 2015

Comment

Hi Guys,
You will not get any direct benefit by reduction in corporate tax rates. But if your employer company can save some taxes it may result in higher payouts in the form of salary increments. Further if you can be benefited as a shareholder if you are holding any company's shares. By this consumer will be benefited because of corporate tax reduction.

Sujan Mitra,

17th March 2015

Those people who have plenty of investments in plots, physical gold, etc. shall benefit from abolition of wealth tax. The government intends to recover an amount equivalent to the annual wealth tax collection by way of additional surcharge of 2 per cent from those who earn more than Rs 1 crore of taxable income. Given all this, I think that abolishing the wealth tax is not detrimental.

Harmeet Kaur,

17th March 2015

Hi,

As per my knowledge, one consumer can further claim deduction for the housing Loan interest, that paid up to Rs 20,0000 in case of self occupied property and the full interest deduction for a rented property. So pr-paying the housing loan is more of a financial decision base on whether you cost of housing loan post the tax benefits is more that what is your opportunity cost (post tax) if you invest the amount somewhere else instead of prepaying.

lekshmi.sanjeev@ymail.com, Delhi

18th March 2015

Hi Guys,

According to me, tental income is taxable under the head income from house property. You can claim the deduction of municipal taxes paid, standard deduction at the rate 30per cent of the rental income (net of municipal taxes) and the interest on the loan taken for purchase or reconstruction or repairs (if any) from it and the balance needs to be offered for the taxation as income. However, if the balance amount is negative then the same can be used to set-off against your other taxable income such as salary, interest, etc.

Veena K,

19th March 2015

Hi,

In my point of view, consumer have to buy or build a residential house to be eligible to claim tax exemption on capital gains. If you are buying the house and getting the ownership rights of the property then you will eligible to claim the Exemption u/s. 54. This is how you can save on capital gain tax while buying tenancy premise.

Bulbul Verma,

20th March 2015

Another major thigh to remember is the buyer would deduct the TDS and pay only the balance sum. If you are a resident then TDS would be one per cent. However, if you are a non-resident then the TDS would be 20 per cent (if property is long term capital asset for you) or 30 per cent (if it is short term, i.e. period of holding is up to three years) of the sale value unless you/buyer obtains a certificate from the income tax department for lower deduction of the tax.

Subho Mallik, Delhi

17th February 2015

Comment

If the property is a long term capital asset, it could help if you sell the property after March 31 as you would get indexation benefit of one more year.

One will have to discharge the income tax liability on the gains arising from the sale of the house. The rate of tax would be 20 per cent, plus surcharge and education cess as applicable, on the amount of gain if the property is held for more than three years. If the property is held for lesser period the gains would be taxed as per the tax slab applicable to you. However, it is advisable that you take profession advice to minimize your tax burden.
This is my advice to those who doesn't know about tax benefit by property investment.

lekshmi.sanjeev@ymail.com, Delhi

18th February 2015

Hi All ,

According to me, most other benefits you can get from property investment is tax rebate for two housing loan. A consumer is eligible to claim home loan tax benefits even if he/she has two properties. In fact, the tax rebates are nothing to do with the number of properties. One can enjoy claims on tax deductions a housing loan on any number of properties.

Baljeet Singh, Chandigarh

17th February 2015

Comment

Hi Guys,

In my point of view, all are not aware of tax benefits by property investment. Property investment is a very good way to avail tax benefit. Most common question occurs while discussing is:- Suppose some one has an ongoing home loan for an under-construction flat. Can that person avail tax benefits on the same, if any? If not, does that person need to wait till possession before claiming tax benefits?

Iram Khan, Delhi-NCR

17th February 2015

Comment

That's a nice question you raised Mr Khan. As per my point of view, In this case one has to wait until you obtain possession to be able to claim tax benefit on the housing loan interest and principal repayments. The tax benefits start only from the year in which you obtain possession of the house. In the year of possession, you would be entitled to claim deduction of interest for that entire year plus one fifth of the interest payable during all the preceding years on this loan

Udit, Faridabad

17th February 2015

Hi All,

As per my knowledge, it is wise to note that deduction equivalent to the one fifth of pre-construction period interest is available for each of first five years starting with the year of possession. The total amount of interest deduction is restricted to Rs 150,000 if the property is self-occupied. Principal repayment deduction too is available from the year of possession. However, no deduction can be claimed on the principal repayments made during the pre-construction period.

Rajib, Faridabad

17th February 2015