Home loans are considered to be a boon for people who wish to go for an own house. They play a key role in fulfilling this basic need of people.
In addition to giving the joy of owning a house, home loans provide few other benefits. The most important of such benefits is tax exemption the principal and interest paid over a financial period.
A Customer can get a maximum benefit of about INR 100,000 under section 80C of Income Tax act 1965. Also, a customer can also get a maximum benefit of about INR 20,000 on the principal amount repaid during a financial year under the section 88 of the principle repayment of the home loan.
Added to the aforementioned, a customer can claim tax exemption for the amount paid as stamp duty during the registration process. The Bank provides the customer with the provisional certificates to claim the tax exemption from the income Tax department. The home loans that do not fall under tax exemption category include top-up, plot and Mortgage loans.