HOUSING LOAN (TOP-UP) INTEREST DEDUCTIONS RULES INCOME TAX 2023-24 U/S 24, 80EE, 80EEA 1) Deduction for interest paid on housing loan under u/s 24 A home loan must be taken for the purchase or construction of a house to claim a tax deduction. If it is taken for the construction of a house, then it must be completed within five years from the end of the financial year in which the loan was taken. The interest paid on the home loan EMI for the year can be claimed as a deduction from your total income up to a maximum of Rs 2 lakh under Sec 24. From the assessment year 2018-19 onwards, the maximum deduction for interest paid on self- occupied house property is Rs 2 lakh. For let out property, there is no upper limit for claiming tax exemption on interest, which means that you can claim deduction on the entire interest paid on your home loan. In case the construction exceeds the stipulated time, i.e. 5 years, you can claim deductions on interest of home loan only up to Rs 30,000 for the financial year. However, the overall loss can be claimed under the head ‘Income from House Property’ against any other head of income up to to Rs 2 lakh only. This deduction can be claimed from the year in which the construction of the house is completed. 2)Additional deduction under Section 80EE Additional deduction under Section 80E€ is allowed to the home buyers for a maximum of up to Rs 50,000. To claim this deduction, the following conditions should be met: The amount of loan taken should be Rs 35 lakh or less, and the property's value does not exceed Rs 50 lakh. The loan must have been sanctioned between 1st April 2016 to 31st March 2017. And on the date of loan sanction, the lual does not own any other house, st-time house owner. Section 80EE was reintroduced but is valid for loans sanctioned till 31st March 2017 only. 3) Additional deduction under Section 80EEA To promote the housing sector, Budget 2019 has introduced an additional deduction under Section 80EEA for homebuyers for a maximum of up to Rs 1.5 lakh. To claim this deduction, below mentioned conditions should be met: The stamp value of the property does not exceed Rs 45 lakh. The loan must have been sanctioned between 1 April 2019 to 31 March 2022 (extended from 31 March 2021) On the date of loan sanction, the individual does not own any other house, i.e. first time home buyer. The individual should not be eligible to cl claiming deduction under this section. 4)How do Tax Benefits on Top-Up Home Loans Work? Providing proper documentation for your top-up loan’s usage in acquiring, building, repairing, or renovating your residential property can help you with tax savings. A regular home loan allows for a maximum deduction of Rs 2 lakh on interest payments. Top-up loans dedicated to repairs and alterations qualify for a maximum tax deduction of Rs 30,000.Only a self-occupied house is subject to the Rs 30,000 limit. There is no limit to the amount of deduction that can be claimed if the repairs and renovations were done on a rented property. The amount of tax relief on principal repayment is determined by how the funds are used. If the funds are used to particularly, build or buy a new home, the principal and interest will be eligible for tax deductions under sections 80C and 24(b) of the Internal Revenue Code, respectively. Also, you cannot claim a deduction on principal repayment of your loan if you use the funds for repairs or renovations.in the long run, a top-up loan on a home loan with a tax exemption can help to reduce the repayment load. In case of self-occupied property the maximum deduction available on repayment of interest of a top-up home loan is of Rs 30,000. This deduction is under the overall limit of Rs 2 lakh. In case of a let-out property, you can get unlimited deduction on interest payment of a top-up home loan.Page NO.02 TAX EXEMPTIONS Under New TAX REGIME FOR THE F.Y 2023-24 1) Transport allowances in case of a specially-abled person. 2) Conveyance allowance received to meet the conveyance expenditure incurred as part of the employment. 3) Any compensation received to meet the cost of travel on tour or transfer. 4) Daily allowance received to meet the ordinary regular charges or expenditure you incur on account of absence from his regular place of duty. 5) Perquisites for official purposes 6) Exemption on voluntary retirement 10(10C), gratuity u/s 10(10) and Leave encashment u/s 10(10AA) 7) Interest on Home Loan on let-out property (Section 24) 8) Gifts up to Rs 50,000 9) Deduction for employer's contribution to NPS account [Section 80CCD(2)] 10) Deduction for additional employee cost (Section 80JJA) 11)Budget2023 introduced a standard deduction of Rs.50,000 under New Tax Regime applicable from FY 2023-24 12) Budget 2023 also introduced deduction under Section 57(jia) of family pension income 13) Budget 2023 further introduced deduction of amount paid or deposited in the Agniveer Corpus Fund under Section 80CCH(2). NEW REGIME INCOME TAX 2023-24 SLAB RATES (After Standard Deduction Rs.50000/-only) SI.No. TOTAL INCOME TAX PARTICULARS 1. __| Upto Rs.3.00 Lakhs NO TAX 2. __ | From Rs.3.00 Lakhs to Rs.6.00 Lakhs 5% (Rs.15000/-) 3. _| From Rs.6.00 Lakhs to Rs.9.00 Lakhs 15000 + 10% (Rs.30000/-) 4. _| From Rs.9.00 Lakhs to Rs.12.00 Lakhs 45000 + 15%(Rs.45000/-) 5. _ | From Rs.12.00 Lakhs to Rs.15.00 Lakhs _ | 90000 + 20%(Rs.60000/-) 6 ‘ABOVE 15.00 LAKHS 150000 + 30% OLD REGIME INCOME TAX 2023-24 SLAB RATES BELOW 60 YEARS EMPLOYEES ABOVE 60 YEARS EMPLOYEES TOTAL INCOME TAX PARTICULARS | TOTAL INCOME TAX PARTICULARS Upto Rs.2.5 Lakhs NOTAX Up to Rs.3.0 Lakhs NOTAX '5% (Rs.12500/-) From Rs.3.00 Lto R5.5.001 | 5% (Rs.10000/-) 3.001 | 12500 + 20% (Rs.100000/-) | From Rs.5.00 L to Rs.10.00L | 10000 + 20% (Rs.100000/-) ‘ABOVE 10.00 LAKHS 112500 + 30% ‘ABOVE 10.00 LAKHS 110000 + 30% NOTE:EVERY EMPLOYEES PLEASE OLD& NEW REGIME COMPULSORY.