Loan deductions for my home loan

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i am taking a home loan is there a limit on the amount i can claim deductions in my return... my prinicple is for a fy is 6,23,568 and interest will be 3,80,285...so how to claim deductions in my itr...plz guide.

Replies (13)
Principal repayment qualifies for tax deduction under section 80C of the Income-tax Act, 1961. ... Apart from principal repayment, you can claim deduction of up to Rs2 lakh for interest payment on home loans under section 24(b) of the Act.

so u mean i can claim entire 6 lakhs in 80c ? which section of 80c?

Principle amount u/s 80C maximum rs. 1.50 Lac along with other eligible deduction if any And interest u/s 24(b) Rs. 2.00 Lac maximum
Sec 24(b) claim Upto 2lakhs...
under 80C You can claim Rs. 1.5lakhs (All such deduction under 80C)...
The above replies are valid if ur home is not let out, in case it is let out the entire amount of interest will be available for deduction.
Let out or self occupied Even Rs. 2lakhs will be available...
Originally posted by : dumb Nitish
The above replies are valid if ur home is not let out, in case it is let out the entire amount of interest will be available for deduction.

 

 it will be let out property....so r u saying i cannot get any deductions at all? 

 

@ Neha.,

Nothing...
You can get deductions as per above reply as
"Interest - under Sec 24(b) claim Upto 2lakhs... 
Principle - under 80C You can claim Rs. 1.5lakhs (Including All such deduction under sec 80C)...

the propetry is let out...so in 80c is the deduction of 1.5 over and above the ppf investment?

also if i am staying in same city and property is let out then too can i claim the deduction under 80c?

Under 80C if u have exhausted the limit of 1.50 lakhs by investing in ppf then u wont get additional benefit of principal re payment. As u said that the property is let out u can claim the entire amount of interest expenses as deduction. But setoff with other heads is limited to 2 lakhs and u can carryforward upto 8 years. For example if the rental income is suppose 5 lakhs and the interest expense is 8 lakhs, then u can claim the expense of 8 lakhs against 5 lakhs house property income, the balance expense of 3 lakhs can be adjusted against any other income like salary or Business income to the extent to 2 lakhs, and the rest 1 lakh can be carried forward to next 8 years for adjustment with the income of next years subject to above limit.
Ms Neha,
you can claim principal under section 80 C (but there is a ceiling of 1.5 lac on it and 80C also includes other payments). suppose you have invested 80,000 in PPF and have paid 20,000 for any eligible policy of LIC and have paid, as you said, more than 8 lacs against principal ofsum borrowed.T hough all these payments are eligible for deduction under section 80C. But, you can claim only 1.5 lacs as deduction in that section as there is a ceiling of 1.5 lac. on any remaining portion of principal and other payments (Ppf, lic etc.) you will have to pay tax.

now comes the interest part. you can only claim upto 2 lac ( whether the house property is self occupied or let out) under section 24(b) while computing your income under the head house property. so suppose you are getting rent of 4 lacs as rent from that house property (which is your income) and paying 3 lacs as interest in respect of any loan that was taken for that property then your net income will be 2 lac (4-2) from the head "income from house property" and you have to pay tax on these 2 lacs. sometimes we incur loss also. say, if you are getting rent of of only 1 lac and paying 3 lac interest then you loss of 2 lac (3-1). this loss can be set off from income of other heads such as salaries etc. BUT ONLY IN THE SAME YEAR AND ONLY TO THE EOF RS. 2 LAC. Indian income tax had 5 heads of income I.e. salaries, income from house property, capital gains, profit and gains of business or profession and income from other sources.
one more thing, you can carry forward the loss of house property and set off this loss but ONLY FROM INCOME OF HOUSE PROPERTY for 8 more years so if you are getting rent of 1 lac and paying 4 lac as interest then you are having a loss of 3 lacs in that year. now you can set this off from income of other heads (in that year) BUT ONLY TO THE EXTENT OF 2LAC. remaining 1 lac loss can be carried forward fot 8 years and set off only from NET INCOME FROM HOUSE PROPERTY, OF THAT YEAR, if available.

there are many other permutations and combinations but I think your query will be resolved from this reply.

Regards

Ratan Deep ( Income tax officer)
you can claim RS. 1,50,000/- under 80C and RS. 2,00,000/- under Section 24(b)


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