Tax Benefit Information

A home loan must be taken for the purchase/construction of a house and the construction of the house must be completed within 5 years from the end of the financial year in which the loan was taken.

If you are paying EMI for the housing loan, it has two components –

  • interest payment, and
  • principal repayment.

The interest portion of the EMI paid for the year can be claimed as a deduction from your total income up to a maximum of Rs 2 lakh under Section 24.

From Assessment Year 2018-19 onwards, the maximum deduction for interest paid on Self Occupied house property is Rs 2 Lakh.

For let out property, there is no upper limit for claiming interest.

However, the overall loss one can claim under the head of House Property is restricted to Rs 2 lakh only. This Deduction can be claimed from the year in which the construction of the house is completed.

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