Do you wish to own a dream house but don’t have the fund required for it? Well, you can fulfil your dream by availing HDFC bank home loan. The HDFC offers home loans to both salaried and self-employed individuals to help them buy a new house. This loan is offered for a flexible tenure ranging between 5 to 30 years at reasonable interest rates. The loan can be repaid in terms of affordable EMIs, which is fixed at Rs. 769 per lakh by HDFC.
Along with the flexibility in repayment tenure, the HDFC bank home loan also comes with lucrative tax benefits. According to the laws set by the Income Tax Department of India, the taxpayers of the country are eligible to get certain tax deductions on their home loans. It is necessary to be acquainted with the tax benefits available on HDFC bank home loan to be able to enjoy such benefits during loan repayment.
HDFC bank home loan tax benefits
HDFC bank home loan provides tax benefits whereby you can save on the HDFC bank home loan interest rates as well as the principal payable at the time of loan repayment. Such a tax benefit scheme has been introduced and is being regulated by the Income Tax Department of India. The borrower needs to claim tax deductions that he/she is liable to get on a home loan. The tax benefits have been segregated under different sections of the Income Tax Act. Below goes the tax benefits elaborated under Section 24 (b) and Section 80C.
Tax benefits: Section 24 (b)
Under Section 24 (b) of the Income Tax Act, you can get a tax benefit on the interest payable on the home loan. HDFC bank home loan offers a tax deduction of up to Rs. 2 lakh on a home loan interest amount in case property is occupied by the borrower in that Assessment Year. On the other hand, if the property is not self-occupied and is rented, then you can claim deduction of the whole interest amount on your loan. As per Section 24(b), it is considered mandatory to construct or purchase a new property within 5 years of getting the loan. This tenure is calculated from the end of the financial year in which the home loan was sanctioned. This tax deduction is available for home loans taken for any real estate property. No restriction is imposed on the sale of the property for availing the tax benefits.
Tax benefits: Section 80c
Section 80 (c) of the Income Tax Act allows borrowers to claim a tax deduction on the principal amount of a home loan to be repaid. A deduction of up to Rs. 1.5 lakh is allowed under this section. However, such a tax deduction becomes available after the completion of the house construction for which the loan was taken. This tax benefit is offered only on residential house property. Moreover, if you want this tax benefit, you should not sell your property within 5 years from the end of the year when you got possession of the house. If you sell the property within the specified period, the tax deductions would be reversed. Thus, the deductions made in the previous years shall be considered as your income in the year in which the sale of the property is conducted.
Way to claim tax benefits on HDFC bank home loan
You can claim the tax benefits on HDFC bank Home Loan through the steps given below.
- Ensure that you have legal ownership of the property. If you have taken a joint home loan, make sure that you are one of the co-owners of the house.
- Make sure that the home loan has been taken in your name or you are a co-borrower of the loan.
- Considering the rules of the Income Tax Act, calculate the amount of tax deduction that you can claim on your home loan.
- Submit the interest certificate of your home loan to your employer so that he can adjust the Tax Deducted at Source (TDS) accordingly.
- In case you fail to follow these steps, you would need to file an IT return.
Now that you know in and out about the tax deductions available on the HDFC bank home loan, you can enjoy the benefits to cut down the burden of loan repayment. Moreover, you can get affordable HDFC home loan interest rate , starting from only 7% per annum, thereby making it one of the best available home loan options in the market. Avail the HDFC bank home loan with alluring tax benefits and don’t delay in getting a new house for you and your family.