Home Loan Tax Rebate: Have You Claimed These Tax Benefits Yet?

Posted on Monday, February 10th, 2025 | By IndusInd Bank

Summary: A home loan is a secured loan meant for purchasing a residential property. Apart from facilitating home ownership, it offers several tax benefits, including deductions on principal repayment and interest payments and special benefits for first-time homebuyers. Secure a home loan from IndusInd Bank to enjoy attractive interest rates, simplified documentation, and quick processing time.

 Homeownership is a significant milestone in an individual’s life, symbolising security, stability, and a substantial financial investment. However, with property prices at an all-time high, purchasing a home has become increasingly difficult. Consequently, many individuals are securing home loans as a financial tool to fulfil this dream.

Beyond providing the means to own property, home loans offer valuable tax-saving opportunities that can significantly reduce your annual tax obligations. These benefits include deductions on interest payments, rebates on principal repayments, and exclusive rebates for first-time homebuyers.

In this article, we explore the tax benefits of a home loan and how you can optimise your savings.

What is a Home Loan?

A home loan is a type of secured loan provided by banks to help you purchase residential property. The property itself serves as collateral until the loan is fully repaid. Home loans are typically long-term commitments, with repayment tenures lasting up to 30 years.

Tax Benefits on Home Loans

Home loans in India also offer several tax benefits that can significantly reduce your taxable income. Here are the key deductions available under the Income Tax Act:

Tax Exemption Under Section 80C

Deduction on Principal Repayment

Under Section 80C of the Income Tax Act, 1961, you can claim a deduction of up to INR 1.5 lakh per financial year on the principal repayment of your home loanEMI. This deduction can only be claimed if the house is not sold within five years of possession.

Deduction on Stamp Duty and Registration Charges

You can also claim a deduction for stamp duty and registration charges within the total limit of INR 1.5 lakh. This deduction can only be claimed in the year you incur these expenses. 

Tax Exemption Under Section 24

Section 24 of the IT Act allows you to claim a deduction from your income for the interest component. For a self-occupied house, you can claim a maximum deduction of INR 2 lakh per year, provided the construction or acquisition of the house is completed within five years. However, for a let-out property, you can claim a deduction for the entire interest amount.

Tax Exemption Under Section 80EE

Under Section 80EE, first-time home buyers can claim additional deductions of up to INR 50,000. This benefit applies if the property’s value is less than INR 50 lakhs and the home loan amount is below INR 35 lakhs. Additionally, the loan should have been sanctioned between April 1, 2016 and March 31, 2017.

Tax Exemption Under Section 80EEA

First-time home buyers are eligible for an additional deduction of up to INR 1.5 lakhs under Section 80EEA if the property’s stamp value is below INR 45 lakhs. This deduction is applicable for loans sanctioned between April 1, 2019 and March 31, 2022. However, to claim this deduction, the individual should not be eligible for a deduction under Section 80EE.

Attractive Home Loans at IndusInd Bank

Home loans offer significant tax savings by reducing your taxable income. The funds you thus save can be redirected towards savings, investments, and other financial goals.

IndusInd Bank home loans are designed to offer the maximum value with:

1. Attractive Interest Rates

Enjoy attractive home loan interest rates with IndusInd Bank and inch closer to your dream home.

2. Flexible Repayment Tenures

The bank offers home loans with flexible repayment longer tenures of up to 30 years. This allows you to choose a repayment plan that suits your financial situation.

3.  No Hidden Charges

IndusInd Bank maintains transparency in its dealings by clearly outlining all charges.

4. Balance Transfer Facility

You can transfer your current home loan balance from another bank to IndusInd Bank and take advantage of favourable terms. IndusInd Bank empowers you to fulfil your dream of homeownership. Take the first step towards buying your dream home—apply for a home loan online with IndusInd Bank today.

Disclaimer: The information provided in this article is generic and for informational purposes only. It is not a substitute for specific advice in your circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any financial decisions based on the contents and information.