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Tax Benefit On Home Loan: The dream of most people’s life is to build their own house. People work hard day and night to fulfill this dream of theirs. At the same time, the Modi government at the center is also trying to encourage people for their homes. For this, the government is also running many schemes. Along with this, you are being given the benefit of exemption of up to Rs 2 lakh in income tax on home loan. In this news, we are going to give you complete information about Tax Benefit on Home Loan. Know the complete details…
Great offer from bank
Many banks in the country are offering you the best home loan offers to buy a house. These banks are providing home loan facility to their customers at low interest. In home loan you have to pay monthly EMI. You get the benefit of income tax deduction on taking a home loan. However, few people are aware of the fact that the benefit of tax deduction is available on the home loan.
benefit of tax exemption
The central government had said in the year 2020-21 that, all the old regime of income tax on home loan will be applicable till the year 2024. Behind giving tax benefits, the government wants that more and more people should be given the benefit of affordable houses. With the help of the same tax benefit to the housing industry, the country’s economy gets strengthened.
benefit in income tax
The EMI in any home loan is in two parts. The first is the principal amount and the second is the interest amount. According to Section 80C of the Income Tax Act, the benefit of tax exemption of up to 1.5 lakh is available on the principal repayment of the home loan. This deduction is claimed only when you take a loan to buy or construct a residential property. Also, you get general tax exemption on investing in schemes like PF, insurance and fixed deposits.
2 lakh discount on loan interest
Under Section-24 of the Income Tax Act, home buyers also get a tax rebate of up to Rs 2 lakh on the interest paid in a financial year. However, this deduction can be claimed if you are taking a home loan to buy or construct a residential property.
Understand the main things like this
- Under Section 80EEA of the Income Tax Act, a first-time home buyer gets a deduction of up to Rs 1.5 lakh on the interest paid on home loan.
- Under Section 24 of Income Tax, you get the facility of deduction up to Rs 2 lakh.
- You can get housing loan tax benefit of up to Rs 1.5 lakh on the second house bought with the home loan.
- Under section 80EE, you can avail a maximum deduction of Rs 50,000 on the interest portion of the home loan EMI.
- This deduction is more than the deduction on the interest amount under section 24(b) of the Income Tax Act.
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