Section 24
Under Section 24 of the Income Tax Act, you can claim a tax deduction of up to INR. 2 lakhs on the interest paid on a home loan for a self-occupied property. Luckily, there are home loan tax benefits that can help reduce your tax liability.This deduction is available on a yearly basis and can be claimed from the year in which you start repaying your home loan.
Section 80C
Under Section 80C of the Income Tax Act, you can claim a tax deduction of up to INR. 1.5 lakhs on the principal repayment of your home loan. This deduction is available on a yearly basis, and you can claim it from the year in which you start repaying your home loan.
Joint Home Loan
If you have taken a joint home loan, both co-borrowers can claim tax benefits on the principal and interest paid on the home loan. However, the total tax deduction claimed by both the co-borrowers cannot exceed the actual amount of interest and principal repaid.
Pre-Construction Period
Under Section 24, you can also claim tax benefits on the interest paid on the home loan during the pre-construction period. The pre-construction period is the time taken to construct the property, and the interest paid during this period can be claimed in five equal instalments from the year in which the construction is completed.
To sum it up, home loans offer tax benefits that can help you reduce your tax liability. You can claim tax benefits under Section 24 for the interest paid on a home loan, Section 80C for the principal repayment of a home loan, and for the pre-construction period. It is essential to keep a record of all the payments made towards the home loan to claim the tax benefits accurately.
Read Also: Navigating the World of Housing Loans: A Comprehensive Guide
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