At the closing of financial year, many people plan their investments in order to save on their income tax. We have access to a number of investment instruments such as Insurance, National Savings Certificate (NSC), Public Provident Fund (PPF), among many others. However, post 2017 budget session, investing in property too can greatly help save on Income Tax. The Government of India has introduced new property-related by laws for encouraging the common man to boost investment in the real estate sector. Experts from Arun Dev Builders Ltd suggest some useful tips that can help you save on income tax by investing in real estate.
Invest in a second property
As per the Tax experts, investing in a second property is a good option for tax exemption. By investing in a second property, the tax exemption you attain for interest on the loan with no an upper limit. Where loan is taken for a second home, there is no exemption for repayments on the principal sum.
Tax exemption on a home loan
This is a beneficial option for people seeking to own a property in the rapidly booming Indian real estate industry. In case of the first home, both, ‘payment of interest’ and ‘repayment of principal amount’ are entitled for tax benefits.
With ‘Repayment of principal amount’ you become eligible to claim a deduction up to an amount of Rs 1,50,000 under Section 80C. You can avail this benefit irrespective of the fact whether you live in the same property (Self Occupied Property – SOP), or give it on rent (Let Out Property – LOP).
Investing in REITs
According to Arun Dev Builders for investors seeking to invest not more than Rs 2 lakh can make real estate investments via Real Estate Investment Trusts (REITs).
REITs have been thriving on a global scale in channelizing massive investments into properties. Therefore, REIT is anticipated to enjoy positive tax regime and on the whole reduced taxes for tax payers.
Read other informative blogs @ http://arundevbuilders.co.in/blog/ know about more about investing in real estate.