Purchase of land for home construction

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This discussion addresses common questions for individuals purchasing land to build a home, particularly concerning tax implications and home loans. Key topics include TDS formalities, eligibility for housing loans as a non-earning spouse, declaring properties as let out or self-owned in ITR, timelines for claiming tax deductions on interest and principal, and calculating the pre-construction period. It also touches upon the tax effects of buying land now and constructing later, with a loan taken for the land purchase.

Archana

Archana (Querist)

02 July 2024 Hi,
My husband is a salaried employee in pvt sector.We are owning a flat now and we are planning to buy a land in a gated community. I m a housewife. I have some queries regarding related to income tax regarding this.
1. Will we have to do anything for TDS aur they will be doing the formalities?
2. Will I get housing loan as registration charge is less in case of females?
3. Can we show in ITR any one house as let out and another as self owned?
4. Within how much time house should be completed for claiming tax deduction on both interest and principal amount?
5. How much amount can be claimed as deduction every year?
6. How will we calculate pre construction period?will it start from the day we register our plot?
7. How will the tax implications be if we buy land now and construct house after 2 years taking loan for land now and home construction later?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

03 July 2024 1. Yes, if value is Rs. 50lakhs or more.
2. Not up to the extent, as being no source of income.
3. Yes.
4 Max. five years.
5. Max. interest paid upto Rs. 2 lakhs each.
6 In general yes.
7. Not big deal, otherwise it can be taken only over building part.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

28 August 2024 Good luck.

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