Home loan entitles Individuals to Deduction Under Section 80C of up to Rs. 1.50 Lakh and Interest Deduction under section 24 of up to Rs. 2 Lakh. Articles deals with Faqs on Benefit U/s. 24 and 80C on Jointly Owned Property, Under Construction Property, multiple properties and Simultaneous benefit of Interest exemption and HRA.
Q-1 What are Income tax benefits of taking and repaying a housing loan under EMI Plan?
You will be eligible to claim both the interest and principal components of your repayment during the year.
- Interest can be claimed as a deduction under Section 24. You can claim up to Rs. 200,000 (Rs. 150000/- up to A.Y. 2014-15) or the actual interest repaid whichever is lower. (You can claim this interest only when you are in possession of the house)
- Principal can be claimed up to the maximum of Rs. 150,000 (Rs. 100000/- up to A.Y. 2014-15) under Section 80C. This is subject to the maximum level of Rs 150,000 (Rs. 100000/- up to A.Y. 2014-15) across all 80C investments.
- You will need to show the statement provided by the lender showing the repayment for the year as well as the interest & principal components of the same.
Q-2 If I buy a house jointly with my wife and take a joint home loan, Can we both claim income tax deduction?
Ans:-Yes, if your wife is working and has a separate source of income, both of you can claim separate deductions in your income tax returns.The repayment of principal amount of the loan can be claimed as a deduction under section 80C up to a maximum amount of Rs. 1.50 (Rs. 1 Lakh up to A.Y. 2014-15) lakh individually by each co-owner.
In cases where the house is owned by more than one person and is also self-occupied by each co-owner, each co-owner shall be entitled to the deduction individually on account of interest on borrowed money up to a maximum amount of Rs. 2 lakh (Rs. 1.50 Lakh up to A.Y. 2014-15). If the house is given on rent, there is no restriction on this amount. Both co-owners can claim deductions in the ratio of ownership.
Q-3 My husband and I have jointly taken a home loan. He pays 75 percent of the EMI. What will be our individual tax benefits?
Ans: – As you have taken a joint home loan, both of you are eligible for tax exemption for your share of the EMI paid. For claiming income tax deduction, the EMI amount is divided into the principal and interest components. The repayment of the principal amount of loan is claimed as a deduction under section 80C of the Income Tax Act up to a maximum amount of Rs. 1.50 (Rs. 1 Lakh up to A.Y. 2014-15) lakh individually by each co-owner. The repayment of the interest portion of the EMI is also allowed as a deduction under section 24 of the Act, which is given under the head “income from house property”. In case you are living in the house for which home loan is taken, both of you shall be entitled to deduction in the ratio (3:1) on account of interest on borrowed money up to a maximum of Rs. 2 lakh individually (Rs. 1.50 Lakh up to A.Y. 2014-15). If the house is given on rent, there is no restriction on this amount and both co-owners can claim deduction in the ratio of ownership- 3:1 in your case.
Q- 4 plan to buy a house by raising loans from friends and relatives. Will I be eligible for tax benefit from all sources?
Ans: – Interest payment to friends and relatives can be claimed u/s 24 but only against a certificate received from them. In the absence of the certificate, you would not be eligible for the deduction. The recipient of interest income who issues the certificate is liable to pay tax on the interest income that he receives. As far as the principal payments are concerned, they would not qualify for tax benefit as loans only from notified institutions and banks are eligible for such deductions.
Q- 5 What are the tax benefits that I can avail of for repaying a home loan ?
You will be eligible to claim both the interest and principal components of your repayment during the year.
- Interest can be claimed as a deduction under Section 24. You can claim up to Rs. 200,000 (Rs. 1.50 Lakh up to A.Y. 2014-15) or the actual interest repaid whichever is lower. (You can claim this interest only when you are in possession of the house).
- Principal can be claimed up to the maximum of Rs. 150,000 (Rs. 1 Lakh up to A.Y. 2014-15) under Section 80C. This is subject to the maximum level of Rs 150,000 (Rs. 1 Lakh up to A.Y. 2014-15) across all 80C investments.
- You will need to show the statement provided by the lender showing the repayment for the year as well as the interest & principal components of the same. Double Benefit on Taxes on Housing Loan
Q- 6 . Can I take advantage of tax benefits from a home loan as well as claim House Rent Allowance (HRA) ?
If you took a home loan and are still living in a rented place, you will be entitled to:
1. Tax benefit on principal repayment under Section 80C
2. Tax benefit on interest payment under Section 24
3. House Rent Allowance (HRA) benefit
Of course, you can claim tax benefits on the home loan only if your home is ready to live in during that financial year. Once the construction on your home is complete, the HRA benefit stops. If you took a home loan, got possession of the house, have rented it out and stay in a rented accommodation, you will be entitled to all the three benefits mentioned above. However, in this case, the rent you receive would be considered as your taxable income.
Q- 7. I have a home loan in which I am a co-applicant. However, the total EMI amount is paid by me. What is the total income tax exemption that I can avail of ?
Yes, you can claim income tax exemption if you are a co applicant in a housing loan as long as you are also the owner or co owner of the property in question. If you are only person repaying the loan, you can claim the entire tax benefit for yourself (provided you are an owner or co-owner). You should enter into a simple agreement with the other borrowers stating that you will be repaying the entire loan. If you are paying part of the EMI, you will get tax benefits in the proportion to your share in the loan.
Q- 8. I have two housing loans on two different properties. Can I get tax rebate under sec 80 C of both the loans?
Yes, you can get the 80C benefit on both loans. However, the total amount that you will be entitled to will be a total of Rs 150,000 (Rs. 1 Lakh up to A.Y. 2014-15) across both the homes.
The interest paid on a home loan is not directly deductible from your salary income for either of your flat loans. Income from house property will be calculated for each flat you own. If either of theses calculations shows a loss, this loss can be set off against your income from other heads. Please note with effect from financial year 2017-18 Govt has restricted the limit of set off of loss from house property against other heads of Income to Rs. 2 Lakh. Till financial year 2016-17 there was no restriction and assessee was allowed to set-off any loss from house property against other heads of Income. Please note the restriction is placed on set-off of losses and not on the amount of home loan interest that can be claimed as a deduction under Section 24 for a rented house property, the losses which could arise on account of such interest repayment can be set off only to the extent of Rs 2 lakhs. Such loss in excess of Rs. 2 Lakh can be carried forward for upto 8 Assessment Years succeeding the year of loss and can be set off against Income under the head House Property.
As for Section 24 deduction, on your self-occupied house you can take advantage of interest payments up to Rs.2,00,000 (Rs. 1.50 Lakh up to A.Y. 2014-15). For the other property, you can claim actual interest repaid, there is no limit for the same.
Q- 9.I live in Delhi in my own house. In 2011, I took a housing loan to fund the purchase of an under-construction flat in another city (Faridabad which comes under National Capital Region of Delhi but otherwise falls in Haryana). It is expected to be completed in FY 19. I haven’t claimed any tax benefit so far. What happens to the loan installments I have paid so far? Can they also be claimed for tax benefit?
According to the Income-tax Act, 1961, where the property has been acquired or constructed with borrowed capital, the interest payable on such capital for the period prior to the year in which the property has been acquired shall be allowed as deduction in five equal instalments beginning from the year in which the property is acquired. Thus, the interest included in the loan instalment paid by you during the construction period shall be eligible for deduction from the year in which the flat is acquired/construction is completed.
The principal amount of the loan repaid till date shall not be available as a deduction under section 80C till the time the construction of the flat gets completed. Once the flat is completed and the possession is handed over to you, you will be eligible to claim deduction for interest paid on the loan under section 24(b) and principal amount of loan under section 80C. The total amount of deduction available under section 80C shall be limited to Rs. 1.50 lakh (Rs. 1 Lakh up to A.Y. 2014-15). Thus, as of now, you are not eligible for any tax benefit on such loan repayments.
Q. 10 Is there any additional deduction which I can claim in respect of Interest on Housing loan in addition to interest Under Section 24(b)?
Ans. Finance Minister inserted a new section 80EE relating to the additional deduction in respect of interest on loan taken for residential house property. Assessee can avail the benefits of this section in A.Y. 2017-18 & subsequent assessment years till the loan is repaid. Purpose of this section is to promote house ownership & give a fillip to a number of industries like steel, cement, brick, wood etc. besides jobs to thousands of construction workers. to get more information on the please read the Full Article – Section 80EE Income Tax Benefit on Home Loan Interest
Popular Search – home loan tax exemption, interest on housing loan deduction for ay 2019-20, housing loan interest deduction for ay 2019-20, interest on housing loan deduction for ay 2019-20, housing loan interest deduction for ay 2019-20, section 24 of income tax act
Things you must know about tax benefits on home loan
1. Home loan borrowers are entitled to tax benefits under Section 80C and Section 24 of the Income Tax Act. These can be claimed by the property’s owner.
2. In the case of co-owners, all are entitled to tax benefits provided they are co-borrowers for the home loan too. The limit applies to each co-owner.
3. A co-owner, who is not a co-borrower, is not entitled to tax benefits. Similarly, a co-borrower, who is not a co-owner, cannot claim benefits.
4. Housing companies usually require all co-owners to be joint borrowers to a home loan. Loan providers specify who can be a joint borrower for a home loan.
5. The tax benefit is shared by each joint owner in proportion to his share in the home loan. It’s important to establish the share for each co-borrower to claim tax benefits.
6. The certificate issued by the housing loan company, showing the split between principal and interest for the EMIs paid, is required for claiming tax benefits.
(Republished with Amendments)
Hello,
I bought a flat on my wife’s name and taken a loan on both of ours name. EMI is deducting from my account.
In this situation, who (me or my wife) will be eligible for taking tax benefit on housing loan interest part?
i have taken loan against property, the home is in my mother’s name, i am a co-applicant along with my mother, father and brother. can I claim income tax deduction on the interest and principal
I have two housing loans against one property. I have taken a loan of Rs. 10 Lakhs in the year 2012 and another loan of Rs. 12 Lakhs in the year 2013. I am working in public sector enterprise and my wife is housewife. The property is in joint name. Will i get Rs. 2 Lakhs benefit for the IT Deductions under housing loan. Please mail me your answer.
I have taken a Home loan jointly with me and my wife it is self occupied property.My wife is prime applicant and I am co-applicant. The EMI is being paid from my bank account. My wife is not in job she is a housewife and not claiming the tax rebate on this. My Wife is owner of the house and I am not the co-owner of the house.
Can I claim tax rebate of full amount of interest and principal on the housing loan on which i am co-applicant? EMI is going from my bank account.
If I can’t claim tax rebate then Is there any way to by which in future I can take tax benefits over home loan.
I have purchased flat, still under construction. Principal for this year from EMI is 50000. Can I save tax on repayment lets say 100000 in 80C?
sir
i ve availed a housing loan on february 2014. can i get housing loan benifits in the financial year 2015-16 for the interest and principal paid in this financial year.
Sir,
I am a central government employee and want to purchase two properties (two flats) at a time. The bank is asking for two separate housing loan for the same. Now will I get the tax benefit on both the housing loans and how?
Hi,
I hold a house whose registration data is Nov ‘2011.In dec’2015 I am planning to sell that house and buy a new house in Feb’2016.Will I be able to get the complete tax benefit on the capital gain ?
DEAR SIR
WE HAVE OPENED A JOINT ACCOUNT IN POST OFFICE TIME DEPOSITE SCHEME FOR 5 YEARS. CAN WE BOTH OF CLAIM INCOME TAX REBATE IN 80C OR THE SECOND HOLDER.
Hi,
Nice FAQ. I have a query.
I bought a HOUSE, but it is still under construction, not registered yet. My EMIs have started. Is there any tax benefit I can claim in current year i.e, FY 2015-16?
Thanks,
Krishna
Dear sir I have purchased a plot of my mother in low name take a pl me then we take homelone i am only give emi in my salari account can i take income tax deducation
Before marriage i had bought a house by taking home loan of 15 lac. I am the only owner and borrower of my first property..After marriage i and my wife bought a new home in another city just for investment ( My Second Property and my wife’s First Property)….For this new propery my wife is co-owner and co-borrower…EMI is being paid 50-50 by two of us…We are living in my first property and new one second joint property is let out…Now for tax exemption
(1) Will my wife get tax exemption under IT act-24 on 50% interest portion paid to bank without any sealing or cap since her first property is let out and not self-occupied. Or she will get 50% interest tax benefits with maximum sealing of Rs.200000?
(2) Will i get tax exemption under IT act 24 on 50% interest portion paid to bank without any sealing or cap since my second property is let out and not self-occupied.
SIR,
I’m a state employee of A.P .i have taken a loan of house mortgage of an amount 6,50,000/-
does this type of loans are applicable to income tax act,(section 24) ?
please reply through mail.
e-mail: mazambaig708@gmail.com
I have taken Rs.270000/- HBL from Canara Bank on July 2013. I got the possession of the flat on Nov 2015.How can i get rebate in income tax.
I have taken loan of 1300000 in LIC for construction of my house in the year 2011-2012 and EMI of 12750/mnth is deducted.I need the show the investments of current year to my company. Please let me know under which section i should show the investments.
Kindly let me know
I have taken a Home loan jointly with me and my wife it is self occupied property.My wife is prime applicant and I am co-applicant. The EMI is being paid from my bank account. My wife is not in job she is a housewife and not claiming the tax rebate on this. Can I claim tax rebate of full amount of interest and principal on the housing loan on which i am co-applicant? EMI is going from my bank account.
Kindly help me.
I along with my wife own a house which has been purchased via HDFC home loan. My wife is non working and hence I am going to re-pay the complete loan. House construction is complete and we have leased it out. Rent is paid in my Wife’s account as she is also legal co-owner of the house.
Also I am staying with my parents at my father’s house and paying rent to him on monthly basis
Request you to help me w.r.t below queries –
1. Can I claim HRA as I am staying in my father’s house since I am actually transferring amount to his account on monthly basis?
2. Can I claim home loan benefit (i.e. for principal and interest) as per the tax exemption law
3. Should the income generated in the form of rent from the house owned by me and my wife shown as an income for me or my wife?
Can u please tell me, After getting home loan I got a top up above. so how I will show that top up loan in taxable.
Hello sir,
I have taken housing loan in Aug 15 .. 95% amount is disbursed to the builder and 5% is remaining for handing over. Expecting possession in Dec 15 or jan 16.
My query is ..
1. Can I avail tax exemption now?
2. I got a Provisional interest certificate bank and it says for this financial year only interest will be deducted. but in my company they are asking the Principal amount to declare. how to do this?
3. under 80 c we can declare for principal amount and under section 24 we can declare for interest amount. Am I correct?
Regards,
Srinivasan NG.
Dear Sir,
I have taken home loan from bank…also received possession from builder but due to some pending work (Road, Society Formation) Builder not giving possession letter. My company asking for possession letter to get housing loan benefit.
Also Full EMI deducted by bank from last 1.5 Years…
My Question is can i get Housing Loan Principal & Interest Benefit without getting Possession letter…
Sachin Ingle
Hi,
I”m planning to take Home Loan and every month my Tax deduction from Salary is 7K.
So after taking 30 lacs Home loan what will be new Tax deduction ?? Please suggest.
Sir
bank lend loan only upto 80 % of total value of property. if i arrange remaining 20% of total value of property by mortage/gold loan to purchase the property, whether the interest on this gold/mortage loan is eligible for income tax deduction?
can any one have knowledge on this aspect please share.
Thanks
Hi Team,
Could you please provide a list of loans, which comes under tax benefit.
Thanks,
SriSai
Hi,
This is in reference to Q9 where Interest can be claimed in 5 equal parts after the possession. My question is it necessary to claim the interest in 5 subsequent parts or I can claim it total of 5 times only but in skip in any FY.
For example.. I got posssesion of flat in FY 2009 – 2010. Then I file IT returns from FY 2009-2010 till FY 2013-2014 (4 years) where I claimed 4 parts of interest. Now I was out of India during FY 2014-2015 so no Income Tax applicable during this FY.
Now during FY 2015-16, can I claim 5th part of Interest for tax rebate ?
Thanks
I have taken possession of my flat from the Builder in August, 2015. I have availed home loan from SBI. As per the provisional interest certificate, I would have to pay Rs.91,250/-as principal and about Rs.2,30,000/- as interest for FY 2015-16. The property has not been let out sofar. My query are as under:
(1) since I have taken the possession, is it necessary to show some minimum NOTIONAL rental income even it has not been rent out?
(2) If no, whether, I will be eligible to take rebate on actual interest paid as I have taken over the possession or it will be restricted to Rs. 2.00 lakh?
(3) In case, I am able to rent it out, whether, I will get the benefit of rebate for the interest paid in last 2 FYs as the same has not been taken by me for not getting the possession? And if so, whether the rebate will be restricted to Rs.2.00 lakh or it will be on actual basis?
(4) In case, I am NOT able to rent it out, whether, I will get the benefit of rebate for the interest paid in last 2 FYs as the same has not been taken by me for not getting the possession? And if so, whether the rebate will be restricted to Rs.2.00 lakh or it will be on actual basis?
i am co-applicant of home loan . i am not co-owner.
pls tell the affidavit is sufficient to show me as co-owner ?
or cheapest document to make me co-owner in haryana gurgaon ?
If a son avails a home loan to construct a house on his father’s land, can he claim any IT relief for the repayment? (Please note, that though the building belongs to the borrower, it involves no property registration as the land on which it stands was already registered).
Dear Sir,
Can i get deduction for amount paid towards Pre-EMI under section 80C.
Property is in Possession before 31-3-2015.
Sir,
I have a query related to housing loan interest & principle deduction in IT return filling. Can wife claim full deduction of interest & principle which she had partly paid and part paid by her busband but husband is not claiming his portion of interest & princilpe.
can any one guide me..
Thanks,
Manoj
SIR I AND MY MOTHER TAKEN HOME LOAN FOR CONSTRUCTION. IN THIS LOAN MY MOTHER ONLY OWNER OF THE HOUSE PROPERTY BUT FULL INSTALLMENT AND INTEREST PAID BY ME. AM I ELIGIBLE TO TAKE BENEFIT OF REPAYMENT OF HOUSE LOAN AMOUNT. BANK PROVIDE CERTIFICATE ALSO IN THE NAME OF MY MOTHER AND MY NAME.
house property is in my spouse name. but loan is taken as i am co applicant. can 50% of home loan interest and principle can be taken for my income tax deduction? pl. reply immediatly
I have purchased a flat and taken loan from bank. At the time of registration of that flat i paid Rs.1,27,650 for registration charges and stamp duty.can i get tax exemption on this registration charges and stamp duty.If so tell me the section in income tax act.
i want to buy housing property with joint account to my brother & father.
I want to know, how much 80C Exemption limit we get from incometax dept individually.
Whether we all get interest limit of 2 lakh individually or it will be total for all of us.
Please reply.
Sir, i am from mumbai and unmarried currently and have bought a property in pune as an investment. I have taken home loan as single applicant and i m the only owner of property. Now, i m planning to get married in January 2016. My fiancee is also a working woman. Niw i want to add her as co applicant so as to clear my loan early. Is it possible to add her name as co applicant after marriage? And if it is possible…will she able to claim tax benefits as her contribution will be the additional payment to EMI?
Hi,
I earn 6.4L a year.I have 80C upto 1.5L (from LIC and medical,pf etc).I would like to take home loan to buy a plot (15L for 20years).It would come around 14500 EMI.
Please let me the following:
1. How much home loan emi exempted from taxable income.
2. When do i need to start construction,what if i keep it as a plot.
Dear Sir,
I would like to know that can i declare my parent’s “Interest on Housing Loan on fully constructed accomodation”. But loan is on there name and account but I am paying.
Also take a note that i am leaving in different city and taking benifit of HRA.
Thanks,
Jigar
Dear sir,
I want to know that is TDS Deduct on provision for rent exp if tanent is liable U/S 194I
Assessee can claim housing loan interest & principal amount ( Housing loan taken in the name of spouse). can claim Deduction under section 80c???
If one has a property for which no bank loan remains and if he byes a second home in the same city for example: Thane , what will be tax implication considering the person stays in a rental house in mumbai which is little far from his own house and he has both the property let out in thane.
Whether he will be eligible to get the whole interest part tax exemption?
Hi, Is there any time limit for claiming interest on loan during the pre construction period? If i take a loan in 2008 but got possession in 2014( 6 years), How much of accumulated interest can i claim in next five years @ 1/5th every year?
Hello Sir,
During housing loan from SBI- Lucknow, the loan was sanctioned in 2010,to my wife name and according to arrangement letter my name has mentioned as guarantor due to any reason or mistake. At the time of home loan, RACPC taken my salary proof, PF amount, form-16 and all relevant documents by me in the matter of repayment because My wife is house wife and She is not working anywhere so her income is nil. She also did not file income tax return. Now the RACPC is denying to add my name as borrower or co-borrower. We both have an joint account in SBI Ismailganj branch , where the loan has approved and being repayment. The property is belongs to both of our name. The repayment of principal and interest amount are paid by me. Presently we have shifted in home means the property has occupied. Please suggest whether can I able to avail benefits of house loan with my taxable salary ?
Thanks
Dear Sir,
I with my husband are buying an out-right property in Mumbai. And are planning to take a home loan. We both would be owners and borrowers of the property. I am a salaried professional but the loan would be repaid by my husband.
We would continue to stay in our in-laws home in Mumbai itself and put the new flat on rent.
My Husband also owns a property in Navi mumbai, which is co-owned with his brother. This (Navi Mumbai) propety is currently vacant but we will put it on rent.
Can you please guide on the maximum tax benifits that we can get from this New property home loan.
Note: We are yet to get the property and the loan is also under process. We can make required changes if required to get maximum tax benifits.
We booked a house in March 2010 and got the possession in Oct.2014. The property was booked at the name of my wife only. However, both of us were co-borrower for the loan and paid the Pre EMI interest. In Jun’2015 immediately after getting the conveyance deed, she made a transfer deed also, after which we have become the co-owner each to the extent of 50%.
My question is does it entitle me to the claim the benefit against the Pre EMI interest which was paid prior to the possession of the house during the period from April 2010 to March 2014?The pre EMI interest was largely paid by my wife.
Sir, I have taken a loan against my name on my parental property (my mother is actual owner). My parents are not capable of paying the EMI’s. Last year, I took the loan from a national bank to construct the house. The building construction is completed and I am paying the EMI regularly. Can I avail tax benefit of the load amount?
Sir, I have taken a loan against my name on my parental property (my mother is actual owner). My parents are not capable of paying the EMI’s. So, I took the loan in a national bank to construct the house. The building construction is completed and I am paying the EMI regularly. Can I avail tax benefit of the load amount?
Sir
I have two flats at Ghaziabad (UP) and Kolkata (West Bengal). For the Ghaziabad flat, I had taken a home loan which I pre paid in the year 2015. In 2015 itself I have again taken a home loan for my flat in Kolkata. Can I claim any Income Tax rebate for this home loan. If yes, what is the procedure.
Regards,
Sir,
I have Two flats in One Building, I have taken loan for these flats.One flat rented to my friend. I am taking benefit of Interest on loan .Now I have purchased one more property ( Which is under Construction). Shall i take a benefit of loan interest of the new property.
Sir,
I have Two flats in One Building, I have taken loan for these flat.One flat rented to my friend. I am taking benefit of Interest on loan from Income tax ( i.e., 12 C).
Now I have purchased one more property ( Which is under Construction). Shall i take a benefit of loan interest of the new property.
What is differance in deduction under section 24 & 80EE.
Sir Good evening,
I am gov.servent.In my form 16 housing loan intrest is showen deducted. That is Rs.100614. Now I wants to file ITR. So please explaine in which coloum/clause I can enter above figure.