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Section 80EE: Tax Benefits for Homebuyers

Updated on : 17 June 2025

By Hexadecimal Software Team

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What is Section 80EE?

Section 80EE offers first-time homebuyers a tax deduction of up to ₹50,000 annually on home loan interest. It’s an added benefit over Section 24 and helps reduce taxable income, making home ownership more affordable for middle-income buyers.

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Feature	Details
Purpose	Tax deduction for first-time homebuyers
Applicable On	Interest paid on home loan
Deduction Amount	Up to ₹50,000 per year (over and above Sec 24)
Introduced In	FY 2016–17
Benefit Type	Additional deduction

Eligibility Criteria for Section 80EE

To claim Section 80EE, the homebuyer must be a first-time buyer. The loan must be sanctioned between April 1, 2016 and March 31, 2017. Property value must not exceed ₹50 lakh and loan amount should be within ₹35 lakh. Only individuals are eligible.

Criteria	Condition
First-time homebuyer	Yes
Loan sanctioned between	April 1, 2016 – March 31, 2017
Maximum loan amount	₹35 lakh
Maximum property value	₹50 lakh
No other residential property owned	On loan sanction date

Deduction Limit Under Section 80EE

Deduction Type	Amount (Per Year)
Section 80EE Deduction	₹50,000
Over and above Section 24	Yes (₹2 lakh under 24 + ₹50,000 under 80EE)

Comparison: Section 80EE vs Section 80EEA

Section 80EE offers a ₹50,000 deduction for loans sanctioned in FY 2016–17, while 80EEA allows ₹1.5 lakh for loans from FY 2019–20 onwards. Both apply to first-time homebuyers, but cannot be claimed together. Property and loan limits also differ.

Feature	Section 80EE	Section 80EEA
Deduction Limit	₹50,000	₹1.5 lakh
Property Value Limit	₹50 lakh	₹45 lakh
Loan Amount Limit	₹35 lakh	₹35 lakh
Loan Sanction Period	FY 2016–17	FY 2019–20 onwards
Ownership Condition	Must not own other house	Same
Can claim both together?	No	No

Why Section 80EE is Beneficial for Noida Homebuyers

Reason	Explanation
Affordable housing options	Many projects under ₹50 lakh
Eligible zones	Sector 150, Noida Extension, Greater Noida West
Tax savings	Reduces net taxable income
Ideal for salaried buyers	Extra deduction helps increase loan affordability

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Eligible Property Types

Property Type	Eligibility under Section 80EE
Self-occupied home	✅ Yes
Under-construction home	✅ Yes (conditions apply)
Affordable housing units	✅ Yes
Rental property	❌ Not eligible
Commercial property	❌ Not eligible

How to Claim Deduction Under 80EE

Step	Action
1. Verify eligibility	Confirm loan date, amount, and first-time ownership
2. Obtain documents	Get interest certificate from lender
3. File ITR	Report under “Income from House Property”
4. Avoid overlaps	Do not claim 80EEA in the same year

Documents Required for Section 80EE

Document	Purpose
Home loan sanction letter	Proof of loan and sanction period
Sale/purchase agreement	Property value and ownership
Interest certificate	Proof of annual interest paid
PAN and Aadhaar	Identity and income tax filing
First-time ownership declaration	Self-declaration for eligibility

Image Source: Google

Common Mistakes to Avoid

Mistake	Why to Avoid
Claiming both Section 80EE & 80EEA	Not allowed
Missing interest certificate	Deduction can be denied
Property or loan exceeds limit	Ineligible under Section 80EE
Claiming on rental or commercial property	Only self-occupied residential homes allowed

FAQs

Q: What is Section 80EE and how does it benefit homebuyers?A: Section 80EE offers a tax deduction of up to ₹50,000 on interest paid for a home loan, over and above the standard ₹2 lakh deduction under Section 24. It helps first-time homebuyers reduce their tax burden and improve loan affordability.Q: Who is eligible to claim the deduction under Section 80EE?A: First-time homebuyers with a home loan sanctioned between April 1, 2016 and March 31, 2017, on a property valued up to ₹50 lakh and loan amount up to ₹35 lakh, are eligible to claim this deduction.Q: Can Section 80EE be combined with other home loan tax benefits?A: Yes, the deduction under Section 80EE is over and above the ₹2 lakh deduction available under Section 24 on home loan interest. However, it cannot be claimed along with Section 80EEA for the same financial year.Q: How does Section 80EE help homebuyers in Noida?A: Section 80EE supports affordable housing in Noida by providing extra tax relief on interest paid. This reduces overall loan costs, making home ownership more accessible, especially in emerging sectors like Sector 150 and Noida Extension.