An important announcement from the founder of property-bee.com: The future of Property Bee is assured.

Fiscal incentives for greater development

Anything and everything to do with property prices, from news reports and press releases to your comment and theories.

Fiscal incentives for greater development

Postby ShellyHarold on Tue May 19, 2009 9:42 am

In order to enable Housing Finance Companies (HFCs) to attract deposits from the general public, the government of Kerala has extended various fiscal incentives to the private banking institutions. For developing a Home in Kerala, a property owner is now flooded with a host of financial options that can be availed in the minimum time and with little paper work.

At present any public company formed and registered with the main objective of carrying on the business of long term finance for construction or purchase of houses for residential purposes is eligible for following benefits under the Income Tax Act provided that the company is for the time being approved by the Central Government for the purpose of clause (viii) of sub-section (1) of Section 36 of the Income Tax Act.
1. Interest received from deposits with the HFC along with interest/income received from other deposits mentioned in Section 80L is eligible for deduction from the income of the depositor up to Rs.10,000 for the purpose of computation of Income Tax.
2. An income Tax assessee is also entitled to 20 percent rebate from income tax for repayment of amount (not exceeding Rs.10,000) towards the loan taken from the HFC for purchase and construction of a house in a residential property, vide Section 88 of the Income Tax Act.
3. Deposits with HFCs or investments in bonds issued by the HFC from the income derived from property held under a trust formed wholly for charitable or religious purposes quality as an eligible mode of investment under Section 11(5) of the Income Tax Act.
4. Deposits made with HFC are exempt from Wealth Tax under Section 5(1) (XXVII) of the Wealth Tax
5. HFC can create a special reserve within an amount not exceeding 40 percent of the total income and such a reserve is admissible as a deduction for computing income chargeable to income tax under the head ‘Profits & Gains of Business or Profession’ vide Section 36(1) (viii) of the Income Tax Act.
ShellyHarold
 
Posts: 1
Joined: Tue May 19, 2009 9:39 am

Re: Fiscal incentives for greater development

Postby jago25_98 on Sun May 24, 2009 7:30 pm

Thank for informing :-)

I've often wondered. If a good school adds (for simplicity's sake) £50,000 to each 3 bedroom home in an area, and there are 1000 homes in the school catchment, then that gives a potential £50,000,000 budget for transforming a school or building a new one.

But how best to unite a community to invest in services? Some people will not benefit. Some may prefer cash now than capital growth. These things can be allowed for.

Has anyone heard of an example of this working in a simple way, where people can opt in and invest but also be counted out/billed on sale if they don't invest and capital growth occurs, rather than traditional one size fits all taxes (i.e. democratic).
jago25_98
 
Posts: 5
Joined: Mon Feb 02, 2009 8:06 am


Return to Property Prices

Who is online

Users browsing this forum: No registered users and 1 guest

cron