Housing Loan Interest Under Section 24

Interest paid on housing loan taken for a rented out property can be claimed as deduction under section 24 b even in the new proposed tax regime.

Housing loan interest under section 24. This benefit is over the rs. The tax benefits under section 80ee are applicable only for first time home buyers whereas tax benefits under section 24 are available for everyone. In respect of self occupied house property interest deduction u s 24 b is restricted to rs 2 00 000.

Budget 2020 has proposed a new tax regime with lower tax slab rates along with removal of almost all deductions exemptions. Additional deductions are available u s 80ee and 80eea. 2 00 000 allowed under section 24.

Home loan interest paid up to rs 2 lakh per year is tax deductible u s 24. Section 80c allows deduction against principal repayment of up to rs 1 5 lakh every year. 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.

This particular section is titled deductions from income from house property. A great chunk of one s income goes towards home loan emi. The deductions available are loan interest and standard deduction.

A comparison between section 24 and 80c is given hereunder interest deduction with hra. Interest on home loan is allowed under section 24b while principal on home loan is allowed under section 80c. Buying a home is one of the most common long term investment goals for most indians.

So the government has given plenty of tax benefits for house property under section 24 of the income tax act. 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. Maximum deduction allowed under this section is rs 1 50 000.