Do the daily advertisements of fancy residential projects tempt you to buy a house of your own? Home loans are available with suitable EMIs from various banks but do your research and opt for a loan package that suits you best.
TAKING A HOUSING LOAN:
Typically, the longer the loan tenure, the lower is the monthly EMI but higher is the interest outgo. The Reserve Bank of India (RBI) has prohibited banks from levying any foreclosure charges if you pay off the loan prior to its tenure. Once you have the loan in hand, you will be paying a periodical interest and also repaying the principal — in tranches. The I-T law provides for benefits in both instances.
Tax Benefits on interest paid:
Interest payable on 'self-occupied' property is subject to a maximum deduction of Rs 2 lakh under the head 'Income from house property'. Even a loan taken from an employer, friend or private lender is eligible for such a deduction. Booking an apartment which is under construction is sometimes cheaper. The I-T law permits you to claim the total interest paid during the pre-delivery period as a deduction in five equal instalments starting from the financial year in which the construction was completed or you acquired your apartment (generally this denotes the date of possession). Of course, the maximum you can claim as deduction per year continues to be Rs 2 lakh.
Caution point: A certifi cate from the lender is required to claim deduction on interest even if the lender is an employer or a friend. To claim deduction of Rs 2 lakh, it is essential that the acquisition or construction is completed within 3 years from the end of the fi nancial year in which the loan was taken; else the deduction allowed will be limited to Rs 30,000.
Union Budget 2015
Reference:
http://timesofindia.indiatimes.com/budget-2015/union-budget-2015/Budget-2015-Union-Budget-2015/articleshow/46419746.cms?
TAKING A HOUSING LOAN:
Typically, the longer the loan tenure, the lower is the monthly EMI but higher is the interest outgo. The Reserve Bank of India (RBI) has prohibited banks from levying any foreclosure charges if you pay off the loan prior to its tenure. Once you have the loan in hand, you will be paying a periodical interest and also repaying the principal — in tranches. The I-T law provides for benefits in both instances.
Tax Benefits on interest paid:
Interest payable on 'self-occupied' property is subject to a maximum deduction of Rs 2 lakh under the head 'Income from house property'. Even a loan taken from an employer, friend or private lender is eligible for such a deduction. Booking an apartment which is under construction is sometimes cheaper. The I-T law permits you to claim the total interest paid during the pre-delivery period as a deduction in five equal instalments starting from the financial year in which the construction was completed or you acquired your apartment (generally this denotes the date of possession). Of course, the maximum you can claim as deduction per year continues to be Rs 2 lakh.
Caution point: A certifi cate from the lender is required to claim deduction on interest even if the lender is an employer or a friend. To claim deduction of Rs 2 lakh, it is essential that the acquisition or construction is completed within 3 years from the end of the fi nancial year in which the loan was taken; else the deduction allowed will be limited to Rs 30,000.
Union Budget 2015
Reference:
http://timesofindia.indiatimes.com/budget-2015/union-budget-2015/Budget-2015-Union-Budget-2015/articleshow/46419746.cms?