softer interest rates for home loans have led to an uptick in residential property registrations across india the icing on the cake is that repayment of principal and the interest amount provide various tax breaks which help reduce a taxpayers total incometax it outgo for instance under section 80c of the it act the principal is allowed as a deduction from the taxpayers gross total income subject to an overall cap of rs 15 lakh with other eligible investments under section 24 the interest payable on selfoccupied property is subject to a maximum deduction of rs 2 lakh however it should be noted that deduction of interest on housing loan from a selfoccupied house property is not available if the taxpayer opts for the new simplified personal income tax regime ditto in such cases the benefits under section 80c are not available tax experts and professional associations call for several amendments in the it act to alleviate the challenges faced by home buyers which in turn would boost the real estate sector some of the issues which need a relook are detailed below book an apartment pay emi interest but tax deduction is available in the futurewhile booking an apartment is sometimes cheaper the it act permits a taxpayer to claim the total interest paid during the predelivery period as a deduction in five equal instalments starting from the financial year in which the construction was completed or the taxpayer acquired your apartment generally this denotes the date of possession the chamber of tax consultants ctc in their prebudget memorandum refer to section 23 explanation to the second proviso they point out that though taxpayers have to pay emi interest from the date of taking the loan the deduction is postponed to future years putting more financial burden on the borrower who may also be bearing the brunt of rent expenses many times the projects are delayed this adds further burden on the taxpayer ctc has suggested that the deduction for interest payable during construction period must be allowed in the year of payment cap on interest deductioninterest payable on selfoccupied property is subject to a maximum deduction of 2 lakh under the head income from house property it can be set off against other income heads of income which includes salary income in the same year this reduces the total it liability but to claim this it is essential that the acquisition or construction is completed within 5 years from the end of the financial year in which the loan was taken else the deduction is limited to 30000hinesh r doshi chartered accountant and past president at ctc says in view of the rising prices of real estate and current inflation rate the existing interest deduction limit of rs 200000 and rs 30000 needs to be increased considerably this limit of rs 200000 was applicable from april 1 2015 almost seven years ago since then real estate prices have almost doubledhinesh r doshi chartered accountant and past president at