Is the deduction under sec 80EEA available only for the year of purchase of the property or it is available throughout the term period of the loan as long as we pay interest?
Section 80EEA was introduced by the budget of 2019, which provided for deduction of up to ₹1.50 lakh, which an individual can claim in respect of interest on home loan subject to satisfaction of certain conditions. This deduction is available if your home loan is sanctioned during the period 1st April 2019 to 31st March, 2022 and the stamp duty value of the house bought did not exceed Rs. 45 lakhs and you did not own any other house. The loan should have been taken from bank or a housing finance company.
This deduction is available based on the date of sanction of the home loan and not the date of disbursement of the same. Even the date of purchase or completion of construction of the house property is not relevant for this purpose. You can claim this deduction during the construction period in case you had taken the home loan for an under construction house unlike deduction under Section 80C for repayment of principal amount of home loan and under Section 24 for interest on home loan.
This deduction is available for the whole tenure of the home loan. So you can claim it as long as you are servicing the home loan.
(Balwant Jain is a tax and investment expert and can be reached on [email protected] and @jainbalwant on his twitter handle)