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Tax Benefits & Deductions for Greater Noida Homebuyers: Maximizing Your Savings

Introduction:

• Explain that beyond the property’s sale price, there are significant additional costs involved in buying a home.   
• Highlight that the Indian Income Tax Act offers several provisions to help homebuyers reduce their tax liability, effectively making the purchase more affordable.
• Emphasize that these are “deductions from taxable income,” not direct reductions from the property price.

Key Tax Deductions a Buyer Can Claim (Indian Income Tax Act):

1. Under Section 80C (Maximum Deduction: ₹1,50,000 per financial year):
   • Principal Repayment of Home Loan: The principal amount you repay on your home loan EMI (Equated Monthly Installment) is eligible for deduction.   
   • Stamp Duty and Registration Charges: The amount you pay for stamp duty and registration of the property can also be claimed under this section.   
     • Important Note: This deduction can only be claimed in the financial year the expenses (stamp duty and registration) were actually incurred, regardless of when the property is completed or possession is taken.
     • Condition: The property must not be sold within 5 years from the end of the financial year in which possession was obtained. If sold before, the previously claimed deductions might be added back to your taxable income.   
2. Under Section 24(b) (Maximum Deduction: ₹2,00,000 for self-occupied property):
   • Interest Paid on Home Loan: The interest component of your home loan EMI is eligible for deduction. 

   • Limits:

     • For a self-occupied property, the maximum deduction is ₹2,00,000 per financial year. This deduction is available if the loan is taken for acquisition or construction, and the construction is completed within 5 years from the end of the financial year in which the loan was sanctioned. If construction is delayed beyond 5 years, the deduction limit reduces to ₹30,000.
     • For a let-out (rented) property, there is no upper limit on the interest deduction. The entire interest paid can be claimed, though any resultant loss from house property income can only be set off against other income up to ₹2,00,000, and the balance can be carried forward for 8 subsequent assessment years.  
       • Pre-construction Interest: Interest paid during the pre-construction period (before the property is ready for possession) can be claimed in 5 equal installments starting from the financial year in which the construction is completed. This is also subject to the overall limit under Section 24(b).   

1. Under Section 80EE (Additional Deduction: Up to ₹50,000):

   • This section was specifically for first-time homebuyers.
   • Conditions:
     • Loan sanctioned between April 1, 2016, and March 31, 2017.  
     • Loan amount should not exceed ₹35 lakhs.
     • Property value should not exceed ₹50 lakhs.
     • The taxpayer should not own any other residential property on the date of loan sanction.
   • Note: This section has largely been superseded by Section 80EEA, but it’s good to mention its historical context.
2. Under Section 80EEA (Additional Deduction: Up to ₹1,50,000):
   • This is an additional deduction for interest on home loans for affordable housing, specifically for first-time homebuyers.  

   • Conditions:

     • Loan sanctioned between April 1, 2019, and March 31, 2022.
     • Stamp duty value of the property does not exceed ₹45 lakhs.
     • The taxpayer should not own any other residential property on the date of loan sanction.
     • The carpet area of the house should not exceed 60 square meters (645 sq ft) in metropolitan cities (which includes Noida and Greater Noida) and 90 square meters (968 sq ft) in other cities.  
   • This deduction is over and above the limits provided under Section 24(b).
3. TDS (Tax Deducted at Source) on Property Purchase (Section 194-IA):
   • What it is: If the property value is ₹50 Lakhs or more, the buyer is responsible for deducting 1% of the sale consideration as TDS and depositing it with the Income Tax Department. This is a deduction from the payment to the seller, not a tax deduction for the buyer’s income tax.  
   • Buyer’s Responsibility: The buyer must deduct this 1% before paying the seller and then deposit it using Challan 26QB. The buyer also needs to issue Form 16B to the seller as proof of this deduction.
   • Not applicable: For agricultural land, or if the property value is less than ₹50 lakhs. (For NRIs, different TDS rules apply under Section 195).   

Important Considerations for Buyers:

• Old vs. New Tax Regime: Most of these deductions (especially those under 80C, 24(b), 80EE, 80EEA) are available only if the taxpayer opts for the Old Tax Regime. Under the New Tax Regime, most deductions and exemptions are not available. Advise readers to consult a tax advisor to determine which regime is more beneficial for them.   

• Joint Home Loans:

  If a home loan is taken jointly, each co-borrower (who is also a co-owner of the property) can claim deductions separately under Sections 80C, 24(b), 80EE, and 80EEA, up to the individual limits. This can significantly increase the total tax benefits.

• Documentation: Always maintain proper records of all payments, loan statements (principal and interest certificates), and receipts for stamp duty and registration for claiming these deductions.
• Professional Advice: Strongly recommend consulting a qualified tax advisor or chartered accountant to understand the specific applicability of these deductions to their individual financial situation, as tax laws are complex and subject to change.

Greater Noida Industrial Development Authority (GNIDA)

https://gnida.up.gov.in/en

The official website for all matters related to land allotment, property policies, transfer procedures, and outstanding dues for properties within Greater Noida. Essential for verifying lease deeds, mutation status, transfer charges, and official announcements. Look for “Public Notices & Office Orders,” “Schemes,” and “Online Services.”

Inspector General of Stamps and Registration, Uttar Pradesh (IGRSUP)

https://igrsup.gov.in/igrsup

The primary state government portal for stamp duty, property registration, and encumbrance certificates in Uttar Pradesh. Use this for verifying sale deeds, estimating stamp duty and registration fees, and checking property records. Look for “सम्पत्ति पंजीकरण,” “स्टाम्प-निबन्धन शुल्क कैलकुलेटर,” and “भारमुक्त प्रमाणपत्र.”

Uttar Pradesh Real Estate Regulatory Authority (UP RERA)

https://www.up-rera.in/

The regulatory body for real estate projects in Uttar Pradesh. Crucial for verifying the RERA registration status of builders and projects, checking project details, and accessing important circulars related to buyer rights and project compliance.