Are you planning to buy a house and wondering how you can save on taxes? Home Loans come with several tax benefits on home loans that can help reduce your overall tax liability. Let’s explore how you can make the most of these benefits and keep more money in your pocket.
What Tax Benefits On Home Loans You Get?
When you take a home loan in India, you can avail tax benefits on home loans under various sections of the Income Tax Act. Here are the key sections you should know that:
- Section 80 C: Deduction on Principal Repayment
- Section 24 D: Deduction on Interest Paid
- Section 80 C: Additional Deduction for First Time Home Buyer
- Section 80 EEA: Additional Deduction for Affordable Housing.
How much can you save under section 80 C?
Section 80 C allows you to claim a deduction up to RS 1.5 lakh per year on the principal repayment of your home loan. This section also includes other investments like PPF, EPF, NSC and Life Insurance Premiums.
What is Section EEA all about?
Section 80 EEA extends additional benefits to those buying affordable housing. You can claim a deduction of up to Rs 1.5 lakh per year on the interest paid. This is available for loans santioned between April 1, 2019 and March 31, 2022 and the property value should not exceed Rs 45 Lakh.
What are the conditions for claiming these deductions?
To Claim these tax benefits on home loans you need to ensure:
- The home loan is taken for the purchase or construction of a residents property.
- The Construction should be completed within 5 yeras from the end of the financial years in which the loan was taken.
- You should retain the ownership of the house property to claim the benefits.
Conclusion
By understanding and utilizing the tax benefits on home loans you can significantly reduce you tax liability and make your dream of owing a home more affordable. Always keep an eye on the eligibility criteria and ensure you have all the necessary documentation to claim these benefits with smart planning you can maximize your savings and enjoy the financial benefits of home ownership in India.
Ready to make the most of your home loans? Stay by exploring these tax benefits on home loans today and take a step closer to your dream home.