How Do I Avail 5 Lakh Tax Benefits On Home Loan

 It is the dream of everyone to have a home. Many people take a home loan to fulfil their housing needs. 

Even the Government encourages one to move into a shelter by offering home loan tax benefits. 

But did you know that you can also pocket up to Rs.5 lakh as the home loan tax benefit? Yes, that’s possible. 

Go through this post!

1. Via tax deduction on principal repayment 

You get to enjoy home loan tax benefits via the EMI repayments comprising the principal as well as interest component. Section 80C of the Income Tax Act lets you save up to Rs.1.5 lakh. But to do that, you must not sell off your property within 5 years. 

2. Via tax exemption on home loan interest repayment

The interest portion of your home loan EMI repayment also lets you save up to Rs.2 lakh. Section 24 of the IT Act lets you do that. It is on the self occupied property, with no cap on rented ones. 

3. Via extra exemption under section 80EEA

If you are buying an affordable home, an extra deduction of up to Rs.1.5 is allowed for 1 more year till 31 March 2022. It is for the interest part. For the principal portion, it goes up to rs.2 lakh. But, the value of your property must not exceed Rs.45 lakh. The next condition is that the housing loan should be sanctioned between 1 April 2019 and 31 March 2020. It should also be your first property to avail of this facility. 

These sections can help you avail of up to Rs.5 lakh home loan tax benefits.