Section 80C of the Income Tax Act remains the most popular tax saving option, especially for the salaried class. It allows you to save up to Rs 1.5 lakh per annum. But, what if you exhaust the limit? In that case, a home loan can come to your rescue. Home loan is taken by those who cannot pay the entire amount to purchase a property. To encourage people to purchase residential property, the Income Tax Act, 1961, has various provisions to help borrowers claim tax deductions on home loan repayment.
These tax benefits can be claimed under different sections of the income tax. Here is all you need to know –
Benefit on Interest Paid
Any home loan borrower is eligible to claim a tax deduction on the interest part of the loan under Section 24 of the I-T Act. If the borrower or their family resides at the purchased property, they can claim maximum interest deduction of up to Rs 2 lakh. If the property is on rent, there is no limit on the interest deduction meaning you can claim…