he month of March is nearing and it is the season of filing income tax (IT) returns. Most people would have already planned their investments so that they can save on their income tax. There are several instruments such as public provident fund (PPF), insurance, National Savings Certificate (NSC) among many others available to help you save on taxes. It may come as surprise for many that investing in property too can help you save on IT. The Government of India, in its last budget session, brought in new property related policies in order to encourage the common man to invest more in the realty sector and save on taxes. Hence, if you haven’t planned your investments yet, here are few tips that can help you save on IT by investing in property.

1. Simple Tips To Save Tax
By Investing In Property

3. Investing in a second property apart from an owned
property is a good idea as you obtain tax exemption for
interest on the loan without an upper limit.
However, you should be aware that the second property
must not be for self-occupation, but for rental purposes.
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4. The income tax department allows an exemption on capital
gains by reinvesting it in other capital assets within a
specific period. The recent budget increased this period
from one year to three years. This means that you have
three years to reinvest your capital gains into other assets
without being taxed.
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5. The government has allowed tax exemption on the home
loan interests of up to Rs.2,00,000 annually. If the property
is co-owned, each owner may claim a rebate on their
respective share of loan interest. Hence, it is a good idea to
co-own a property with your spouse or another family
member.
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6. Regulators are currently working on creating a platform for
investors to invest in REITs. REITs have seen a success on
a global scale in channelizing huge savings into properties.
Hence, REIT is expected to enjoy favourable tax regime
and overall reduced taxes for tax payers.
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8. CommonFloor.com is India's leading property search portal.
On a mission to make property search hassle-free, transparent and fruitful;
CF has best of breed property search on maps, property search mobile apps and
an extensive section for knowledge resources and advice in real estate.