Here are some of the top announcements made in Budget 2020-21 that can bring tax relief for home buyers and developers of affordable housing as well
1. The tax holiday for projects under the affordable housing category available under Section 80IBA which was available for the projects which are approved by March 31, 2020 will be available even for the projects which are approved till March 31, 2021.
2. The threshold limit for applying the provision to tax the difference as capital gains or income from other sources in case the stated consideration is lower than the stamp duty valuation, has been increased from the existing 5% to 10%. This will help the home buyer where the actual consideration is lower but the stamp duty valuation continues to be high in cases where the difference does not exceed 10% instead of the existing threshold limit of 5%.
3. For the purpose of computing the capital gains the tax payers have the option to take the fair market value of the land and building as on April 1, 2001. There were no restrictions earlier on how much the same varied from stamp duty valuations. Now, the budget proposes that the same can not in any case, be higher than the stamp duty valuation.
4. The additional benefit of Rs 1.5 lakh of interest available under Section 80EEA introduced last year, was applicable in case the home loan was sanctioned between April 1, 2019 to March 31, 2020. Now, Budget 2020 announced that the same will be available for home buyers who get their home loan sanctioned between April 1, 2020 and March 31, 2021.
5. The budget
also proposes a different concessional tax rate regime for individuals who do
not avail various tax benefits. The tax benefit listed include HRA and
interest on home loan, deduction under Section 80 C which includes home loan
repayment. Due to these benefits being made optional, the proposed tax regime
would most likely be a non-starter, and have no major impact in terms of
encouraging people to invest in homes, in my opinion.
Source: housing.com