ITR filing for home loan
When filing an income tax return (ITR) in relation to a home loan, there are certain aspects to consider.
Here’s a general overview:
Interest Deduction:
If you have taken a home loan for a self-occupied property, you may be eligible to claim a deduction on the interest paid on the loan under Section 24(b) of the Income Tax Act. The maximum allowable deduction for a self-occupied property is limited to Rs. 2 lakh per financial year.. However, if the property is let out or deemed to be let out, there is no maximum limit for claiming the interest deduction.
For more information visit this site: https://www.incometax.gov.in
Principal Repayment Deduction:
The repayment of the principal amount of the home loan is eligible for a deduction under Section 80C of the Income Tax Act. This deduction contributes to the overall limit of Rs. , 1.5 lakh for various investments and expenses. It’s important to note that this deduction is available for the principal repayment, not the entire EMI (Equated Monthly Installment) amount, which also includes interest.
Ownership and Co-borrowers:
If you have taken a joint home loan with a co-borrower, both individuals can claim deductions in proportion to their ownership and the loan repayment made by each individual.
Completion of Construction:
To claim the deductions for interest and principal repayment, ensure that the construction of the property is complete. The deductions can be claimed starting from the financial year in which the construction is completed. ITR filing for home loan:
Required Documents:
While filing the ITR, you may be required to provide supporting documents related to the home loan, such as the loan certificate, interest certificate, and details of the principal repayment made during the financial year.
ITR Form:
Choose the appropriate ITR form based on your income sources, residential status, and other criteria. As of my knowledge cutoff in September 2021, for individuals with income from salary and house property, ITR-1 or ITR-2 forms may be applicable. However, it’s advisable to consult the latest guidelines and choose the relevant form accordingly.
Disclosure and Reporting:
Report the details of the home loan, including the loan amount, interest paid, and principal repayment, in the relevant sections of the ITR form. Provide accurate information about the property and loan details to ensure proper tax computation.
It’s essential to note that the specific rules and provisions related to home loan deductions may change over time. It’s advisable to refer to the latest guidelines issued by the income tax department or consult a tax professional to ensure accurate reporting and compliance with the applicable regulations while ITR filing for home loan. ITR filing for home loan: