What kind of Tax Benefit does an individual get while availing a Home Loan facility ?
Answer. Today, one of the major motivator for availing home loan to buy/build our house is the Income Tax benefit attached with it. If you have availed of a home loan, you can claim tax benefits on both the principal and interest components of the home loan as per the Income Tax Act. You can reduce your tax liability by a maximum of Rs. 6,250 per month (Rs. 75000 p.a.). Under section 80(c) , repayment of principal of up to Rs. 1 lks is deductible in full from your income which means you can save tax up to a maximum of Rs. 30,000 p.a. on principal. Under Section 24 of the Income Tax Act, interest is deductible up to a maximum of Rs. 1.5 lks. Thus, this leads to an additional saving of a maximum of Rs. 45,000 p.a.
