Business Desk – Home Loan is the best way for those who are looking to buy a new house. It helps you to provide funds so that you can use it on property. Not only this, but it also helps you to save taxes. According to the Income Tax Act, of 1961, the Home Loan offers tax deductions that not only help homeowners but also increase the demand for houses to push the economy.
Ways To Save Taxes Using Home Loan
According to Income Tax Act Section 80C, homeowners can claim a tax deduction of up to Rs 1.5 lakh on the principal repayment. This deduction can be claimed only once in a financial year. To get this benefit, the property must be completed.
According to Income Tax Act Section 24, a taxpayer can bring down tax liability by Rs 2 lakh, claiming deductions on home loan interest payments. To get this benefit, the property must be completed within five years. Otherwise, the deductions will come down to Rs 30,000.
According to Income Tax Act Section 80EE, tax deductions up to Rs 50,000 can avail on the interest payable towards a home loan. To get this benefit, the taxpayer must be availed of a loan of not more than Rs 35 lakh. Also, they do not have any other residential property at the time of the home loan.
Notably, the home loan tax deductions under Section 24(b), Section 80C, and Section 80EEA are not available in the new tax regime.
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