Blog Banner

Save up to Rs7* Lakh on Tax Deductions on Home Loans

Save up to Rs7* Lakh on Tax Deductions on Home Loans

The Government of India has several benefits under the Income Tax Act to help out first-time home investors. Under section 80C, an investor can claim a deduction of Rs. 1.5 lakh on taxable income from principal repayment. One-time stamp duty charges and registration charges can both also be claimed under section 80C of the Income Tax Act.

In order to claim this deduction, the construction of the property must be completed within a five-year span of possession. The property must not be sold within five years, and if sold, claims will be reversed the in same year.

Section 24 specifies that a homeowner can claim deductions up to Rs. 2 lakhs on interest on a self-occupied property. This is applicable on property constructed within five years from the end of the financial year of taking the loan. If the time period for construction exceeds five years, you can only claim a deduction of Rs. 30,000 on interest.

Section 80EE is applicable for first-time homebuyers and offers a deduction of Rs. 1.5 lakh on interest payments on loans. This is on interest payable each financial year and is applicable for loans of not more than Rs. 35 lakhs. This tax benefit can only be availed of by investors if the property’s value does not exceed Rs. 50 lakhs.

The Pradhan Mantri Awas Yojana scheme is for individuals with annual incomes between Rs. 3 lakhs and Rs. 18 lakhs. The scheme has a subsidy of up to Rs. 2.67 lakhs for applicants and family members with no pucca houses.

Home loans taken on joint ownership of property can benefit the borrowers. Each borrower can claim a maximum income of Rs. 2 lakhs on interest and Rs. 1.5 lakh on principal amounts. This will add up to a tax benefit of Rs. 7 lakhs in total.

The Prestige City new launch township at Sarjapur Road, East Bangalore.

Enquiry Now