Tax Deductions 80C Registration and Stamp duty Charges
We have earlier posted about Tax returns and other various tax related post. Now as the new financial year is progressing we are sure people are looking for ways to fulfill their quota of Tax deductions by investing in 80C. Housing loan also forms a major component when it comes to tax saving. Read more on housing loan and 80C rules. We would like to make you aware of Registration and stamp duty charges that you give while purchasing a house can also be used to save tax.
You all would be aware of the fact that principal and interest part of home loan is deducted for your total income. But this area within 80C (in fact quite a few of them) is constantly overlooked and unknown to most people. Apart from the 80C Principal Component and section 24 on interest paid there is another one where people can reduce their tax liabilities with respect to their home buying process.
The charges you spent towards registration and stamp duty is exempted from tax under 80C.Mr X buys a flat/house and pays 60K as registration charges and this entire 60K can be used for the exemption. However there are some points that you need to take care of to save the tax.
- The claim has to be done on the same financial year and cannot be carried to the next financial year unlike section 24(your EMI & pre-EMI Component).
- This is not a separate section as such and since this comes under 80C so the max amount you can claim with this is one lakh.
- This can be used irrespective whether the house was bought with/without loan.
- Applicable only for flat/independent houses and this cannot be availed for vacant plots.
- You can show copy of registration and stamp duty slip to income tax department.
You can read our articles on Tax savings
- Tax deductions – 80C – Provident Fund
- Housing Loan Principal and Interest Amount Tax Savings
- Section 80C – Tuition Fees for Children