Property tax has been the bone of contention for several years. Common citizens of the country had typical complaints about tax payment for owning a property or more than one property. The 2019 Union Budget was announced by finance minister Piyush Goyal recently. In the budget it the minister announced a bunch of benefits for property owners. Let have a look at them in this blog.
Mainly, the ministry of finance made three prominent announcements. They are:
Second self-occupied property exempted from tax on Notional rent
Until now property owners had to pay tax on notional rent on the second property that they own, irrespective of whether it accrues any rent income or not. Now, the tax payers are exempted from paying tax for their second property if it not fetching any rent, especially in cases where the property is occupied by family members. This happens in cases when someone’s native home is possessed by parents or relative. In the union budget it was announced that tax payers can claim two owned houses as self-occupied and exempted from paying any tax on such notional rent if such property is not rented out.
TDS limit increase for rental income
Another big benefit for real estate owners is the increase in the limit for rent on which the tax is deducted prior to the payment of rent. The tenant will have to get the tax deduction done if their annual rent exceeds Rs 2.4 lakhs. Earlier, this limit was Rs 1.8 lakhs. The tax will be deducted at source unless the tenant is an individual or belong to Hindu Undivided Family (HUF).
Section 80 (i) Income Tax benefits
The Union budget announced the extension of benefits under Section 80(i) BA of income tax act by one year. All the housing projects registered under RERA by March, 2020 will be affected by this change. Real estate projects with carpet area limited to 30 square meters will gain from 100% profit deduction. However, this law is applicable under certain terms & conditions.
These announcements have brought a new lease of life for the property owners who were in tremendous pressure to pay property tax, or shelve out tax on rent. But the government initiative of ‘housing for all’ through the union budget is likely to boost real estate business in India. For more details one can go through the government website to learn about the changes and the effects it will make on general population.
It is high time to get your own property in Chandigarh. The steady rise in the real estate prices provides a good scope to invest in real estate of Tricity. Remember, property prices in Chandigarh are expected to rise steadily in the next 2-5 years.