Home loan interest rates gets benefit

Home loan interest rates gets benefit

Home loan interest rates gets benefit

Home loan takers can rejoice. The revised discussion paper on the Direct Tax Code (DTC) has proposed to continue with the existing system of deducting interest payment (up to Rs 1.5 lakh) against home loan from total income before calculating the tax liability.

The discussion paper released on August 2009 had proposed to do away with all the exemptions, including the tax benefit on interest payment against home loan. This, if implemented, could discourage home buyers.

However, the department had also increased the exemption limit to Rs 3 lakh from the present level of Rs 1.1 lakh against investments in select instruments like PPF, pension funds and life insurance schemes. The Rs 1.5 lakh interest benefit against home loan will be included under 3 lakh ceiling.

In the DTC, the government had earlier argued that as the exemption limit against investments has been increased, taxpayers will not be affected if benefit on interest payment against home loan is withdrawn. However, the withdrawal attracted a lot of criticism. And the government finally decided to get back to the earlier system.

Even if the interest payment against home loan is not treated as a separate category and will be the part of the exemption limit of Rs 3 lakh, taxpayers will still benefit. According to the original DTC proposal, interest payment against home loan was not allowed for deduction from the income. As many middle-income taxpayers will find it difficult to exhaust the 3 lakh ceiling,inclusion of interest payment of Rs 1.5 lakh in the total exemption limit will be beneficial.

According to experts, government should continue with the deduction against interest payment on home loan as a separate category, considering contribution of the housing sector to the gross domestic product.

Click to Compare Home Loan Interest Rates

POST COMMENT

4 Home Remedies For Teeth Whitening That Are So Simple And Effective Even A Monkey Could Do Them! Techniques for Work at Home Moms to Get Their Job Done How To Hire The Best Los Angeles Moving Company Planning Retirement? Have a look at Mexico Real Estate KitchenAid KICA0WH Work From Home? How To Handle Those Pesky Neighbors Property in Mumbai – Residential Property, Commercial Property, Real Estate Developer in Mumbai Owner Financed Home in Austin - 8303 Minnesota Lane - 78745 How To Get Your Foot In The Door Commercial Properties in Delhi – Commercial Properties, Real Estate Developers Gurgaon Outdoor Activities All About Home Accessories Why Modern Dining Room Furniture?