Borrowers of home loans can avail several benefits of owning property that the government offers as home loan tax benefit due to income tax deduction under Section 24. Banks and non-banking finance companies such as Bajaj Finserv offer home loans to applicants desirous of owning a home or property.
Under income tax deduction under section 24, homeowners may claim a deduction for a certain amount on their home loan interest, provided the borrower or his family resides in the house property. They can claim the same amount of home loan tax benefit even if their house is vacant. However, if they have rented out the property, they can claim the entire amount of interest on the home loan as deduction.
Borrowers can claim deductions under Section 24 of the Indian Income Tax Act, which offers home loan tax benefits.
To claim income tax deduction under Section 24, the borrower must have taken the loan after 1st April 1999, for construction or purchase. It is also necessary for the borrower to have completed the construction or acquisition within 5 years from the end of the financial year when they availed the loan. The borrower must have the interest certificate available for the interest payable on their loan.