New Delhi: Presenting the Interim Budget 2019 in Parliament on Friday, Finance Minister Piyush Goyal proposed to exempt the levy of income tax on notional rent on a second self-occupied house.
Currently, income tax on notional rent is payable if one has more than one self-occupied house. The FM said that the relief has been announced considering the difficulty of the middle class having to maintain families at two locations on account of their job, children’s education, care of parents etc.
Goyal also proposed that the TDS threshold for deduction of tax on rent to be increased from Rs 1,80,000 to Rs 2,40,000 for providing relief to small taxpayers.
Further, the Finance Minister proposed to increase the benefit of rollover of capital gains under Section 54 of the Income Tax Act from investment in one residential house to two residential houses for a taxpayer having capital gains up to Rs 2 crore. However, this benefit can be availed once in a life time
For making more homes available under affordable housing, the benefits under Section 80-IBA of the Income Tax Act is being extended for one more year, i.e., to the housing projects approved till 31st March, 2020. Under Section 80-IBA, 100 per ent deduction of profits is being provided to an assessee engaged in developing and building affordable housing projects subject to certain conditions related to carpet area among others.
Also, for giving impetus to the real estate sector, the Finance Minister proposed to extend the period of exemption from levy of tax on notional rent, on unsold inventories, from one year to two years, from the end of the year in which the project is completed.