Section 80EEA of the Income Tax Act

A person who has bought a home for the first time can claim a deduction benefit of ???1.5 lakh through Section 88EEA on the interest paid on a home loan, though conditions apply to become eligible.??

What is Section 80EEA of the Income Tax Act?

Section 80EEA provides easy access to affordable housing for first-time homebuyers and grants them an additional deduction on home loan interest that exceeds the usual limits.

With the help of this section, an individual can claim up to a ???1.5 lakh deduction per year on the interest paid on the home loan.

Why Was Section 80EEA Introduced?

Section 80EEA was first introduced in the Union Budget 2019 with an objective of ???Housing for All???, especially for people who are buying a home for the first time.??

These are a few primary reasons for introducing Section 80EEA:??

• Additional tax relief to first-time homebuyers, making home ownership financially accessible.
• It improves the real estate sector by urging the purchase of affordable residential properties.
• To extend and expand the tax benefits previously provided in Section 80EE to a wider group of taxpayers.??
• To reduce the interest burden on the people repaying their home loans.

Eligibility Criteria Under Section 80EEA

To claim the income tax deduction of ???1.5 lakh on home loan interest under Section 80EEA, there are some specific criteria a buyer must meet to qualify for it.

Who is Eligible for the Section 80EEA Deduction?

What Should the Loan Sanction Date for Section 80EEA Be?

To become eligible for Section 80EEA, the home loan should have been sanctioned between 1st April 2019 and 31st March 2022, as the sanction date is the key to eligibility. So now, existing eligible buyers can continue to claim the deduction under Section 80EEA.

What Is The Maximum Property Value Allowed?

The stamp duty value of a purchased residential property should not exceed ???45 lakh if you want to qualify for the deduction, as the consideration is taken on stamp duty value, not the property value or the home loan value.??

Deduction and Tax Benefits Under Section 80EEA

Section 80EEA offers a deduction of ???1.5 lakh on home loan interest to the person who has bought a home for the first time. This deduction occurs over and above the standard deduction available under Section 24(b).

What Is The Maximum Deduction Under Section 80EEA?

The maximum deduction under Section 80EEA is ???1.5 lakh in a year, which is claimed on the interest of a home loan EMI and above the limit provided under Section 24(b).

What Tax Benefits Does Section 80EEA Provide?

These are the key tax benefits under Section 80EEA:??

• Additional deduction of ???1.5 lakh on home loan interest.
• It can be claimed along with the deduction of ???2 lakh under Section 24(b), taking the total to ???3.5 lakh.??
• Reduces the taxable income, meaning you have to pay less tax every year.??
• It can be claimed every year as long as you continue to pay the home loan and are eligible.

How To Calculate The Deduction Under Section 80EEA?

The deduction is calculated on the home loan interest you are paying in a financial year.??

So, if the interest paid in the financial year is ???3 lakh, you can claim ???2 lakh under Section 24(b) and the rest of the amount under Section 80EEA when filing your ITR.??

Claiming Section 80EEA During ITR

To claim a deduction under Section 80EEA during income tax return filing, you need to use the old tax regime, because this benefit is not available under the new tax regime.

How to Claim Section 80EEA in ITR?

These steps will help you claim Section 80EEA in ITR:??

• Check your eligibility and make sure you meet all of them under Section 80EEA.
• Collect a home loan interest certificate from the lender.??
• Claim the eligible deduction under Section 24(b) first.
• Now, the remaining eligible deduction should be claimed under Section 80EEA.
• Once all the details are verified, review your details and submit the return.

What Documents Are Needed To Claim Section 80EEA?

• Loan sanction letter if within the eligibility period.
• Interest certificate from bank or lender for the financial year.
• Sales deed to rectify the stamp duty value.
• Self-declaration of first-time homebuyer.
• The PAN Card and Aadhaar Card should be linked to the loan account.

What Should Be Verified Before Filing For Section 80EEA?

• You meet all the criteria for filing Section 80EEA.
• The home loan was sanctioned between 1st April 2019 and 31st March 2022.
• The value of stamp duty should not exceed ???45 lakh.??
• The home loan interest certificate should match the deductions claimed.
• A deduction has already been taken by you under section 24(b).
• All the information provided during the ITR filing should be correct.

Section 80EE vs Section 80EEA vs Section 24(b)

People who are repaying home loans can apply for tax benefits under Section 80EE, Section 80EEA and Section 24(b), but the sections can differ in terms of eligibility, deduction limits and applicability.

How Does This Section Differ From Section 80EE and Section 24(B)?

This is how Section 80EE, Section 80EEA and Section 24(b) differ:

Can You Claim Sections 80EEA, 24(b), and 80C Together?

Together, Section 80EEA, Section 24(b) and Section 80C can be claimed if the individual meets all the conditions. These sections, however, relate to different parts of home loan repayments and have different conditions.??

• Section 24(b) is claimed on the interest of the home loan, which is ???2 lakh annually.
• Section 80EEA is the additional deduction claimed if the annual interest exceeds ???2 lakh per year.??
• Section 80C is a deduction claimed on the principal amount of the home loan repayment and eligible expenses.??

What Is The Deduction Limit Under Section 24(b)?

According to Section 24(b), an individual can get a deduction of up to ???2 lakh on the interest paid on a home loan in a year even if he or she is not a first-time home buyer.

In case two people own the same property and are paying the loan separately, each can claim Rs 2 lakh per year.

FAQs

Who can claim tax benefits under Section 80EEA?

An individual who has bought a home for the first time can claim tax benefits under Section 80EEA.

What is the deduction limit under Section 80EEA?

The deduction limit under Section 80EEA is ???1.5 lakh.??

What is the stamp duty value of property under Section 80EEA?

The stamp duty value of a residential property should be ???45 lakh or below.

Can joint owners claim deduction under Section 80EEA separately?

Yes, joint owners can claim deduction under Section 80EEA separately.??

Is Section 80EEA available under the new tax regime?

Section 80EEA is available under the old tax regime.

Is Section 80EEA still applicable in 2026?

If the loan amount was sanctioned during the eligibility period (1 April 2019 and 31 March 2022), the section is still applicable.