Budget 2023: No double tax benefit on home loan interest principal payments from April 1

Budget 2023 Home Loan Tax Benefit: In the Union Budget 2023 (Union Budget 2023), a big announcement has been made regarding the tax benefit on Home Loan. This announcement means that from April 1, 2023, double taxation of home loan interest and principal payments will be eliminated.

Most people take a home loan from a bank or NBFC to buy a house. Under Section 24 of the Income Tax Act, deduction can be claimed on home loan interest up to Rs 2 lakh. Apart from this, home loan principal amount, stamp duty and registration fee are also covered under Section 80C.

When a taxpayer sells his house, he is allowed to claim a cost of purchase deduction in the computation of capital gains for the expenses incurred in making or buying it. Some taxpayers claim double deduction on interest paid on construction or purchase of property.

The amendment proposed in the Union Budget states that the amount claimed under Section 48 of the Income Tax Act, as interest under Section 24 or as deduction under Chapter VIA is claimed on sale of property. Cos. while selling the property to him.

Therefore, if the home loan interest has been claimed as deduction under section 24 in previous years, it will not be considered as part of the purchase cost. This amendment will also apply to deductions under Chapter VIA of the Income Tax Act as follows.

Repayment of principal amount of loan taken from bank, home loan company etc. under section 80C, stamp duty paid on purchase of residential house under section 80C, registration fee and other expenses, this amendment will come into effect from 1st April 2023. This financial year 2023-24 km.

After this change, the home buyer will have to keep all records and computations of deductions claimed in previous years. Income tax authorities may ask you for all these documents in the year of selling the house.