Some of us believe utilizing a housing scheme for the purpose of owning a house is a very silly - an uncalculated move, a financial mistake. However, the truth is quite the opposite! Given the multiple tax benefits a person can claim while having subscribed to a home loan, there can’t be a better way other than a home loan to finance the purchase a home. Want to know more? Home Loan Co-applicant Tax Benefits are as given below in detail:
- Tax Benefits on the Principal Amount: As per the section 24 of the Income-tax laws, a home loan subscriber is eligible for tax benefits up to Rs 2 lakh on the interest component of their loan.
Tax Benefits on the Interest Component: The section 80C of the income tax laws allow an Indian citizen to claim a deduction of Rs 1.5 lakh from his/her gross annual income for investment. A house is considered as a form of long-term investment and thus, a home loan subscriber can claim a deduction of Rs 1.5 Lakh every year on the principal component of the loan.
Tax Benefits on Joint Home Loan: This is the best of all, if two people belonging to the same family apply for a joint home loan and both of them co-own the house - they can avail tax benefits up to Rs 3.5 lakh (Rs 2 lakh under section 24 and Rs 1.5 lakh under section 80C) separately.
Last but not the least, if you are a first time home buyer you can claim an additional deduction of Rs 50, 000 over and above the benefits allowed under section 24 and section 80C.
Additional Read: How Can Co-Applicant Get Tax Benefits on Joint Home Loan