Actual Property Property is among the most sort-after funding choices in India. You may know that residence loans can assist you purchase the house you might have at all times dreamt about. You may additionally remember that you may declare revenue tax advantages on residence mortgage compensation. Nonetheless, are you conscious that this tax profit can embody deduction for stamp responsibility and registration fees too? 

Stamp responsibility (oblique tax) is paid for the registration of properties. That is imposed on the switch of possession in actual property. Stamp responsibility is levied by the state authorities and so, its price differs from state to state. 

Stamp responsibility on property switch, can go as excessive as 6% to 10% in your property worth. Therefore, a stamp responsibility rebate in revenue tax is usually a enormous sigh of reduction. 

On this publish allow us to perceive – How you can declare stamp responsibility exemption on the acquisition of property for Monetary 12 months 2023-24? What’s the most revenue tax profit {that a} property proprietor can declare on stamp responsibility? Is tax deduction on stamp responsibility accessible for plot/land buy? What’s the standards to assert revenue tax exemption on stamp responsibility whereas submitting ITR?

Stamp Obligation Exemption on Property | FY 2023-24

Revenue tax profit on stamp responsibility is out there underneath part 80c of the Revenue Tax Act. You possibly can declare a tax deduction of as much as Rs 1.50 lakhs on stamp responsibility and registration fees paid for the property switch.

Revenue tax profit on Stamp responsibility is out there underneath outdated tax regime solely.

All tax deductions underneath chapter VIA (like part 80C, 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80EE, 80EEA, 80EEB, 80G, 80GG, 80GGA, 80GGC, 80IA, 80-IAB, 80-IAC, 80-IB, 80-IBA, and so on.) aren’t claimable by these choosing the brand new tax regime. So, stamp responsibility exemption will not be accessible underneath the brand new tax regime.

Beneath are the details that you simply want to pay attention to whereas claiming tax profit on Stamp responsibility;

• Be aware that the Rs 1.5 lakh restrict could be topic to the situation that you haven’t already exhausted the Part 80C restrict by means of different tax-saving devices like EPF, PPF, SCSS, Life Insurance coverage Coverage, ELSS Mutual Fund and so on.
• In case of joint possession of a property, the tax rebate could be availed by the co-owners in proportion to their possession share and as much as Rs. 1.5 lakhs every.
• If in case you have bought a home property in FY 2023-24 and paid for stamp responsibility and registration price, you may declare the deduction underneath Part 80C whereas submitting the Revenue Tax Return for AY 2024-25.
• Suppose you might have paid Rs 4 lakh as stamp responsibility in FY 2023-24, whereas submitting ITR for AY 2024-25, you may declare a tax deduction of as much as Rs 1.5 lakh solely. No deduction could be claimed for the remaining Rs 3.5 lakh.
• There may be no provision to hold ahead the stamp responsibility and declare the remaining balances (unclaimed tax profit) within the following evaluation yr(s).
• Who can declare tax profit on stamp responsibility? – You should be a person proprietor, a co-owner of the property or a member of a Hindu Undivided Household (HUF) that has bought the property.
• The proprietor should be in authorized possession of the property for which the tax rebate is claimed. Kindly notice that stamp responsibility exemption is out there solely on a brand new residential property. The tax deductions could be claimed for a brand new residential home property and not for a resale property.
• Stamp responsibility exemption is not accessible on buy of Land, plot or business property.
• For those who pay stamp responsibility for an under-construction property, you may declare deduction solely if you get possession of that property.
• For those who declare this tax profit, there’s a lock-in interval of 5 years. Which means, you will need to not promote the property throughout this lock-in interval, which is 5 years. For those who promote the property earlier than 5 years, this tax profit is reversed, and the deduction claimed earlier shall be deemed to be the revenue of the assessee (for the FY when such re-sale occurs) and accordingly revenue tax (if any) will probably be payable.

Proceed studying:

(Publish first printed on : 24-Aug-2023)