By 2025, real estate sector in India is expected to contribute 13% of total GDP of the country. To live up to this expectation, various affordable housing schemes and tax benefits are on offer for prospective home buyers.
Income tax benefit on home loans can help buyers substantially reduce the income burden. The income tax act of India, 1961 has dedicated provisions for this cause, with various tax exemption clauses. These include –
- Section 80C of ITA states that the funds used for repayment of the principal home loan amount can be exempted from income tax. The exemption is applicable for up to Rs. 1.5 Lakh every financial year. Any amount exceeding this is subject to standard taxation.
- Section 24(b) provides a tax exemption on the interestrate payable on the total loan amount. This benefit is given for interest payments of up to Rs. 2 Lakh every financial year.
- Section 80EEA is also dedicated to reducing the burden of interest on the borrowers. You can get an additional Rs. 1.5 Lakh on your total disposable income as the tax is exempted. Note that this tax waiver is only applicable till 31st March 2020 for properties of up to Rs. 45 Lakh.
- In case of top up loans, an additional tax waiver Rs. 30,000 can be availed on the interest liable.
You can easily calculate the total tax waived on your home loan repayments using a home loan tax benefit calculator.
However, several other criteria need to be satisfied to avail these policies for tax saving on home loans.
- Exemptions are only applicable if the property has already been constructed, and is utilised as a residential property.
- If the borrower sells the property after 5 years of ownership, the tax benefits will become invalid. If the returns are already disbursed, the exemptions are reversed and added to the following year’s income.
- In case the house is given on rent, the entire home loan interest is waived off from tax exemptions.
Ensuring you fulfil the above mentioned restrictions, you can easily apply for the returns – by yourself, or through your employer. Having the home loan interest certificate at your disposal will smoothen this process by a significant amount.
The number of home loans acquired is increasing in number, mainly due to these benefits of tax waivers, reasonable housing loan interest, and subsidised rates at which you can avail home loans via government sponsored policies.
If you are a prospective home buyer, you should make a note of these exemptions to benefit from them. Additionally, you should also follow up on pointers which can help you avail a home loan at the most beneficial terms and features.
Home loan eligibility and documentation
You can quickly calculate your home loan eligibility by checking whether you satisfy the following criteria. Note that applicants should be between 25 and 65 years of age. A CIBIL score of 750 and above can help individuals avail competitive interest rates as well as other beneficial loan terms and features.
Also, salaried applicants must have at least 3 years of working experience while self-employed individuals must showcase a business vintage of 5 years.
These are among the few things you must know before taking a home loan. Avail the tax benefits for substantial savings over the repayment tenor. Refer to lenders who provide not only attractive rates of interest but additional repayment-friendly terms and features as well.
Best Indian Destination to Visit
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Goa is a state in western India. It is known for its beaches, backwaters, Adventure water Sports, waterfalls, and temples. It is a popular tourist destination due to its laid-back atmosphere, cheap hotels, and world-class restaurants. Palolem Beach, Colva Beach, Agonda Beach, Dudhsagar Falls, Anjuna Market, Church of Our Lady of the Immaculate Conception, Braganza House, Mahadev Temple, Palácio do Deão, Mangeshi Temple, Fontainhas, Bhagwan Mahavir Wildlife Sanctuary, and Reis Magos Fort are famous destination in Goa. And Goa is also know for night life. Enjoy Night clubs, party here . So in Goa you can teste a different culture in Goa.
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Jaipur is the capital of the Indian state of Rajasthan. It alludes to the royal dynasty that once ruled the region and built the Old City, also known as the “Pink City” because of its distinctive building colour, in 1727. In the heart of a grand, colonnaded area lies the City Palace complex. Gardens, courtyards and museums still exist today as part of its royal house. Hawa Mahal, Jainivas Garden, City Palace, Amber Palace at Jantar Mantar, Samode, Light and Sound Show, Nahargarh Fort, Jaigarh Fort, Jal Mahal, Galtaji are some of the best places in Jaipur.
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Manali is a city in Himachal Pradesh, India. It is one of the top ski resorts in India. It is famous for its beautiful surroundings, favorable climate and extensive cultural history. It is a popular travel destination in India and attracts visitors from all over the world.
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The Andaman Islands are an Indian island chain in the Bay of Bengal. And Due to the increasing popularity of beaches and adventure sports like snorkeling and sea walking, tourism to the Andaman and Nicobar Islands is on the rise. Long Island, Havelock Island, Little Andaman Island, Diglipur, Parrot Island, Bharatpur Beach, Samudrika Marine Museum, Cellular Jail, Lamiya Bay Beach are some of the best spots to visit in Andaman and Nichobar. Indian tourists do not require a visa to visit the Andaman Islands, but if they wish to visit any tribal area, they require special authorization from the Deputy Commissioner at Port Blair. Foreign nationals require a permit. This clearance is given to foreign nationals coming by air on arrival at Port Blair. This can be a best Indian destination to visit.