Government Extends Eligibility Period For Claiming Tax Holiday By One More Year

Tax holiday for notified affordable rental housing projects introduced. ► Affordable housing projects approved up to 31 March 2022 (‘erstwhile 31 March 2021′) to be eligible for tax holiday. ► Additional interest deduction of INR 1.5 lakhs for acquisition of specified residential house property by individuals for loan obtained till 31 March 2022 (‘erstwhile 31 March 2021′). ► Deviation up to 120% (‘erstwhile 110%’) where sales consideration is less than stamp duty value for sale of residential units subject to specified conditions. ► Exemption from withholding tax on dividend credited or distributed to REITs. ► Time limit for claiming exemption on long term capital gains derived by individual/HUF from sale of residential property by way of investment in eligible start-up extended by one year. Eligible start-up to mean company/ LLPs incorporated before 1 April 2022 ► Foreign Portfolio Investors to be permitted to provide debt funding to REITs. ► Establishment of Special Purpose Vehicle to monetise land owned by Government/ Ministries/ PSE

In order to incentivise purchase of affordable house, It is proposed to extend the eligibility period for claim of additional deduction for interest of ` 1.5 lakh paid for loan taken for purchase of an affordable house to 31st March 2022. In order to increase the supply of affordable house, it is proposed to extend eligibility period for claiming tax holiday for affordable housing project by one more year to 31st March, 2022. In order to promote supply of Affordable Rental Housing for the migrant workers, it is also proposed to allow a new tax exemption for the notified Affordable Rental Housing Projects.