How much money can you save in taxes every year?
It depends, is the short answer. You must consider several factors, such as your age, taxable income, and principal repayment and interest amount of the assessment year. It is also possible for other factors to come into play.
In contrast, tax assesses under the older regime are entitled to different tax deductions for home loan repayment in comparison to new tax regime assessees.
There are different sections and conditions for home loan tax benefits As you can see, the provisions above provide a glimpse into the considerable savings that can be claimed on income tax liabilities.
Although you should also know the various terms and conditions, as well as the applicable sections, under which such savings are applicable:
1. Section 80C (Home Loan Principal Repayment Deduction) Each taxpayer is only allowed to claim this benefit once in a fiscal year, with the maximum deduction amount limited to Rs.1.5 lakh.
In this particular calculation, in addition to the principal repayment sum, the calculations also take into account the costs of buying the concerned property, such as stamp duty and registration charges.
Section 24 (Discount for home loan interest payments) The maximum deduction based on home loan interest payments is Rs.2 lakh.
The property must, however, complete its construction within five years to qualify for this benefit. The taxpayers will only save Rs.30000 if they fail to do this.
Section 80EE (Deduction for home loan interest for first-time buyers of a property) If you do not own any other property, this section does not apply to you. The following additional conditions must also be met in order to claim this additional benefit:
Home loan principal amounts should not exceed Rs.35 lakh. Property values should not exceed Rs.50 lakh. In addition to these provisions, you can also claim tax deductions under Section 80EEA for affordable housing.
Those who qualify for this can save an additional Rs.1.5 lakh on home loan interest payments besides the interest-related rebates offered under Section 24. You may claim this benefit until your mortgage is repaid in full.
The additional condition is that these tax exemptions may not be available until construction of a property is complete. In contrast, if you buy a ready-to-move property, these benefits will begin immediately.
Furthermore, if you decide to sell the property within five years of acquisition, any tax advantages claimed till that point are considered void. You will need to include these in your taxable income when you file your next tax return.
As you can see, an income tax rebate on mortgages can result in massive savings.
Calculate your home loan tax benefits with the help of a home loan tax benefit calculator. The home loan tax benefit calculator is a specialized online tool that helps you estimate your tax payments while repaying such loans. Although taxpayers have knowledge of the various tax-saving opportunities they can take advantage of, it is difficult for them to assess exact deductions. Completing such calculations may also require long and complex calculations. By contrast, tax benefit calculators provide instant results. It can be used to compute the exact tax obligations before and after home loan benefits are accounted for.
Which calculator tool should you use?
A hdfc home loan is deductible for tax purposes based on a number of factors Calculate your tax benefit by providing the information you must provide.
Assessees are typically asked for the following information by such a tool. The tax payment will be revealed without considering home loan benefits. As a second consideration, taxpayers will realize their tax liabilities after taking into account the tax-saving provisions for housing loan borrowers.
In a different section, you can learn how much tax you are saving by repaying your home loan.