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Tax deduction for Home Loan

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Puneeth L

21 Points Posted on 15 July 2023

I am private sector employee, planning to reduce my taxes.

Can I avail home loan to purchase home from my mother and utilize tax benifits on home loan interest u/s 24. If yes, can I still claim HRA as I will not reside in that newly bought home.

What is the maximum deduction allowed for home loan u/s 24?

Thank you.

Replies (3)

Quick Summary

This discussion clarifies home loan tax deductions for private sector employees. It explains that interest deductions under Section 24 are not available under the new tax regime. You can claim interest paid to your mother if you rent elsewhere, but you cannot claim both HRA and Section 24(b) deductions simultaneously if your property is in the same city.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

121543 Points Posted on 15 July 2023

1. The home loan interest deduction is not available under new tax regime.

2. You cannot claim HRA & sec. 24(b) deduction simultaneously, if your HP is in same city.

3. Yes, you can pay interest to your mother, which will be her taxable income.

sabyasachi mukherjee

Profession

19978 Points Posted on 16 July 2023

You have to stay in a rented house.

Aashok Kumar Sharma

Finance/Compliance Consultant

75653 Points Posted on 08 November 2026

Home loan to buy a house from your father:
• Buying a house from your father (at a genuine price, registered sale deed, payment via a bank loan) is permissible. Interest (Sec 24(b), up to Rs 2 lakh for self-occupied, old regime) and principal (80C) are deductible.
• Banks lend for family purchases if documented properly. Pay a fair price (stamp duty value). If the price is below SDV by more than 10%, Sec 56(2)(x) doesn't apply for a purchase from a relative (exempt).
• Your father will pay capital gains on the sale.
• Ensure it's not a sham (the father continuing to live there without rent may draw scrutiny).