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Top Four Legal Benefits For First Time Home Buyers In India
Owning a house is the dream of every hardworking Indian individual. Having your own house enables a sense of financial soundness and security. It also uplifts the social status of an individual. Most of the Indian individuals today prefer having their own house. Having your own house ensures an individual with a sense of financial achievement.
Nowadays, Indian individuals prefer to buy their own house rather than living in a rental house. The desire for buying a new house has increased in Indian. Considering this increasing desire for buying a house, the Government of India has come up with legal benefits for the first home buyers to support them. First time home buyers, especially, those who come under the low-income group and middle-income group often face difficulties in financing their dream home. Even in cases where they get approved for a home loan, repayment of the same becomes difficult. Considering all these facts, the Government has provided some benefits to the first time home buyer. These benefits include the Pradhan Mantri Awas Yojana (PMAY), Section 80C, Section 80EE and Section 24. These sections offer relief to first-time homebuyers on the payable interest on the home loan.
1. Pradhan Mantri Awas Yojana (PMAY)
Pradhan Mantri Awas Yojana (PMAY) was started on 31st December 2015, with the aim of providing a residential house to every Indian citizen, It’s slogan states “Housing for All”. Under this scheme, it gives first-time homebuyers subsidy for making home buying easy. This makes it more affordable for lower & middle-class people to own their dream home. The subsidy is provided at different rates depending on the income of the people. A person having income up to 18 lakhs rupees can avail of this subsidy.
2. Section 80C
Under this section, the first time home buyer gets the benefit of tax clam, which can extend up to 1.5 lakh rupees on the repayment of the principal amount bought for a home loan. It reduces the tax charged on the principal amount during the time of repayment. An individual gets liberty from paying tax on the amount borrowed for home buying.
3. Section 24
Under this section, tax benefit up to 2 lakh rupees can be availed on the repayment of interest of a home loan. This is only applicable to properties that are individually owned. If one is renting the property, there is no maximum limit on the amount to claim a tax deduction. An individual can claim the entire interest amount or can even claim an amount exceeds 2 lakh rupees.
4. Section 80EE
Under section 80EE, a first time home buyer can avail of a tax deduction of 50,000 rupees as a tax benefit on the interest repayment.
The introduction of these four legal benefits contributes to rapid improvements in the infrastructural developments of India. These legal benefits make the purchase of a first home more eligible and it also makes housing affordable for the common masses in India.
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