Home loan repayment qualify for exemption only if property is having OC

homeloanBy Accommodation Times Bureau

Section 80 C where a limit of exemption is 1,50,000/- is given for home loan seeker who pays principle sum in Equated Monthly Installments (EMI). However, it is provided that property must be complete and occupied with completion certificate. Till then only deduction available is under section 24. If the property is not acquired/constructed completed within 3 years from the end of financial year in which the loan was taken, the interest benefit in this case would be reduced from 2 Lakhs to Rs 30,000 only. This limit of 3 years has been increased to 5 years from Financial Year 2016-17 and onwards.

Under Section 80 C  tax deduction is available on payment basis irrespective of the year for which the payment has been made. The Amount paid as Stamp Duty & Registration Fee is also allowed as tax deduction under Section 80C even if the Assessee has not taken Loan.

If the Home Loan has been taken is not self-occupied, no maximum limit has been prescribed in this case and the borrower can take tax deduction of the whole interest amount under Section 24. The exemption is based on accrual basis. If though nothing is paid, borrower can still calim the deduction under Section 24.

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