Deduction Under Section 24 Interest On Housing Loan

2 lakh on the interest payment of home loan for a self occupied property however no maximum limit applies in case such property which is not self occupied is rented or.

Deduction under section 24 interest on housing loan. Section 24 section 24 of the income tax act deals with interest that an individual pays on home or property loans. It is over and above the deduction of rs 2 00 000 available under section 24 b for interest paid in respect of loan borrowed for acquisition of a residential house property. In case the property for which the housing loan has been taken is rented no maximum limit has been set and thus the taxpayer can avail deduction on the complete amount of interest under section 24.

Budget 2020 has proposed a new tax regime with lower tax slab rates along with removal of almost all deductions exemptions. Section 24b of income tax act allows deduction of interest on home loan from the taxable income. Interest deduction treatment is different depending upon whether the house property is self occupied or it is let out.

The deduction for this interest is allowed in 5 equal instalments starting from the year in which the house is purchased or the construction is completed. The deductions available are loan interest and standard deduction. Maximum deduction allowed under this section is rs 1 50 000.

Interest paid on housing loan is allowed as a deduction to the extent of rs 2 lakhs in respect of self occupied property. Same deduction if the house is vacant also. Section 24 b of the income tax act 1961 deals with deduction of interest from the gav in order to arrive at the net asset value nav.

Under the provisions of the section home buyers can save an additional rs 1 50 lakhs per year towards the interest paid on home loans over and above the rs 2 lakhs that they already save under section 24 b. Use our section 24 deduction calculator to know your deductions on interest on housing loan under section 24. If the property is let out on rent then the entire interest paid on the home loan can be deducted even if that amount is more than 2 lakhs.

Home loan tax benefit under section 24 b interest paid as per section 24 b of the income tax act you can avail tax benefit on home loan interest amount under this section you can claim tax deduction of up to rs. Such deduction is allowed on accrual basis not on paid basis. This particular section is titled deductions from income from house property.