Buying a home in Bangalore is a massive financial commitment but the Indian Income Tax Act provides significant relief through home loan tax deductions that can save you lakhs of rupees.
Principal Repayment: Section 80C
The principal portion of your EMI qualifies for deduction under Section 80C up to a maximum of 1.5 Lakhs per year. Note this limit is shared with other 80C investments like PF, PPF and ELSS.
Interest Repayment: Section 24b
You can claim a deduction of up to 2 Lakhs per year on the interest paid on a home loan for a self-occupied property. For let-out property there is no upper limit on interest you can claim, subject to set-off rules.
First-Time Buyers: Section 80EEA
Under certain conditions first-time homebuyers can claim an additional 1.5 Lakhs on interest under Section 80EEA. Our tax consultants at M.K. Pokkisham can help you structure purchases to maximize tax efficiency.