Additional Deduction on Interest Payment to Home Loan FY 2021

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Hi,

What is the details on additional deduction on Interest Payment Home Loan FY 2021?

Thanks in advance.

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The deduction of Rs 1.5 lakh in a financial year is available under section 80EEA of the Income-tax Act, 1961. Deduction on payment of interest on a housing loan was introduced in Budget 2019. This deduction is available over and above the Rs 2 lakh deduction available on the interest payment on housing loan subject to certain conditions. Thus, the total deduction available to an individual taxpayer on the interest payment of a housing loan for buying an affordable house is Rs 3.5 lakh in a financial year

To avail the tax benefit under this section, certain conditions have to be fulfilled which are as follows:

  • Housing loan must be taken from a financial institution such as a bank or a housing finance company for buying a residential house property.
  • The home loan must be taken between April 1, 2021 and March 31, 2022.
  • Stamp duty value of the house property should not exceed Rs 45 lakhs
  • The individual taxpayer should not be eligible to claim deduction under the existing Section 80EE.
  • The taxpayer should not own any residential house property as on the date of sanction of the loan.
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HI @MadhuPR

Finance minister duing Budget 2021 speech has proposed to extend the timeline for availing home loan by another year for claiming additional deduction on interest payment on such home loans to March 31, 2022. The current deadline for this is March 31, 2021

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