Section 80C limit of Rs 3 lakh, home loan interest deduction up to Rs 1 crore – FICCI recommends

Mortgage Loan Principal and Interest Deduction Rules Under Section 24 (B) and Section 80 C: The Federation of Chambers of Commerce and Industry of India (FICCI) recommended to the central government to remove the limit for the deduction of interest on home loans under Section 24 (b) or increase it from Rs 200,000 to Rs 10,000,000.

In its budget recommendations, the FICCI also suggested to the government that the deduction from the principal amount of the repaid home loan should not be combined with other deductions under Section 80C. He said the deduction should be allowed as a separate deduction above the Rs 1.50,000 limit under Section 80C. Alternatively, the Section 80C limit should be increased to Rs 3 lakh, FICCI suggested.

Explaining the reason for the above recommendations, FICCI said: “Most salaried people buy a home by taking a home loan and use their hard-earned money to pay off that loan. These deductions will increase your purchasing power and boost both the real estate sector and the economy.

The industry body has also suggested that the government relax the conditions for claiming the deduction under Section 80 -IBA.

Eliminate the boundary in the carpet area

Currently, the limit on the area of ​​carpets for shops and commercial establishments is restricted to 3% of the total area of ​​carpets. In addition, the project will be considered completed when a certificate of completion of the project as a whole is obtained in writing from the competent authority, according to Section 80-IBA. The FICCI suggested that the above limit should be relaxed to say that “if the limit according to the relevant competent authority of the jurisdiction is higher, then that limit should apply”.

He also suggested that if “there are different phases to the project, the 5-year completion period should be shortened at the beginning of each phase.

To justify the above suggestion, the FICCI said: “If the carpet area of ​​shops and commercial establishments as required by the relevant competent authority of the jurisdiction exceeds the 3% limit of the prescribed aggregate carpet area, then there is a difficulty to move forward with the affordable housing project. “

“In the case of developing an affordable housing project on a large parcel of land consisting of several buildings, it will be difficult to complete the entire project in its entirety in a period of 5 years. Generally, these large projects are divided into phases. In this case, the completion period of each phase must be 5 years. Consequently, the 5-year period must begin with the taking of all approvals for a particular phase, ”he added.