Tax advantages of Investing in Real Estate

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Tax advantages of Investing in Real Estate
Introduction

Investing into real estate is something that’s done by those who wish for long term returns. But another reason as to why people invest in Real Estate is simply to avail the tax benefits they get from it. Tax advantages of Investing in Real Estate:

For instance, the first home that you purchase, that too on a loan, is eligible for deductions under section 80C to upto 1.5 Lakhs. If in case the property is self occupied, then under section 24(b), a 2 Lakh benefit is available. A point worth noting is that this is valid if the construction is completed within 3 years only.

All the people who are also part of the investment or are co-owners are also eligible for tax deductions provided that they have also taken it on a loan or are co-borrowers.

In regards to the sale of a property, if a property is sold within 3 years of its acquisition. It is considered as a Short Term Capital Asset (STCA) and as per the slab rates is taxed respectively.

Furthermore, there is tax exemption provided in case one wishes to re-invest in another house. Thereby using the sales proceeds of the existing house or the LTCA.

Hopefully the next time you invest. You are aware of all these little tips and facts before going ahead with you investment decisions.

Happy Investing !