How Home Loan is Beneficial for Tax in India?
A legal obligation that has to be tended to without fail, tax is the cornerstone of any country’s
economy. It boosts the growth of the nation by contributing to the GDP (Gross Domestic
Product), caters to the budgetary demands of the nation, and finances the maintenance of
public projects, thereby raising the living standards of the citizens. These charges are so
vital to the health of an economy; a change in tax policies will reflect in the economy’s
growth trajectory. If citizens are not responsible taxpayers, the government will be hindered
in meeting the demands of various sectors in the country. While ensuring that the citizens
carry out their tax obligations, the government also reduces their tax burden in several ways
through tax benefits which also include buying a property for sale in Neemrana.
What is a tax benefit?
A tax benefit is an advantage given to you by the government to avail a reduction on your tax
bill and thus reduce the tax burden. According to Income Tax Act 1961, certain payments
and investments such as tuition fees of children, charitable donations, provident funds,
education loans, medical expenses of disabled family members, and so on can help you
claim your tax benefits. As far as homeowners are concerned, home loans are the biggest
source of tax benefits as per sections 24, 80C, 80EE, and 80 EEA under the Income Tax
How can tax benefits be claimed on a home loan?
A home loan helps you buy your dream house on your residential plots in Neemrana. While
repaying the loan in the form of Equated Monthly Instalments, you can also claim tax
benefits on the principal and interest paid. There are four sections under the Income Tax Act
that help homeowners become eligible for tax deductions, which are section 24, section 80
C, section EE, and section 80 EEA.
Income tax benefits that can be claimed on the home loan for the second house
Under the Income Tax Act (Section 24B), tax benefits can be enjoyed by claiming it as a
self-occupied property while the other would be deemed as a let-out property. Previously it
was limited to one house, but in the 2019 budget, it has been proposed to extend this limit to
two self-occupied houses. Under Section 80C of the Income Tax Act 1961, a deduction of up
to Rs. 1.5 lakh can be claimed on the repayment of the principal amount (including stamp
duty and registration cost). It can be claimed only after the house has been possessed.
If you meet the eligibility criteria stated under various sections of the Income Tax Act, you
can easily reduce your tax burden. In the case of joint loans, make sure your co-borrower is
also your property’s co-owner. After calculating the deductions you are eligible for, submit
your home loan interest certificate to your employer so that they can adjust the TDS (Tax
Deduction at Source) for you.
With the easy loan benefits on the loans, it would be extremely beneficial for you to purchase
property for sale in Neemrana. The township by Manglam Rambagh not only has
residential but commercial properties as well.