Budget 2020-21 + FINANCE BILL, 2020

Extending time limit for approval of affordable housing project for availing deduction under section 80-IBA of the Act.

The existing provisions of section 80-IBA of the Act, inter alia, provide that where the gross total income of an assessee includes any profits and gains derived from the business of developing and building affordable housing projects, there shall, subject to certain conditions specified therein, be allowed a deduction of an amount equal to one hundred per cent of the profits and gains derived from such business. The conditions contained in the section, inter alia, prescribe that the project is approved by the competent authority during the period from 1st June, 2016 to 31st March, 2020.

In order to incentivise building affordable housing to boost the supply of such houses, the period of approval of the project by the competent authority is proposed to be extended to 31st March, 2021.

This amendment will take effect from 1st April, 2021 and will, accordingly, apply in relation to the assessment year 2021-22 and subsequent assessment years.

[Clause 38]

 

 

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Budget 2020-21 + FINANCE BILL, 2020

Extension of approval period for affordable housing projects expands eligibility for full business profit deduction under section 80-IBA. Extension of the approval deadline under section 80-IBA permits additional affordable housing projects to meet the statutory approval-timing condition for claiming a deduction equal to one hundred per cent of profits and gains from the business of developing and building such projects; the approval deadline is extended to 31st March, 2021 and the amendment takes effect from 1st April, 2021, applying to the assessment year 2021-22 and thereafter.