Resident Indians are eligible for certain tax benefits on the principal and interest components of a housing loan under the Income Tax Act, 1961. Tax Benefit on Home Loan for payment of Interest is allowed as a deduction under Section 24 of the Income Tax Act. As per Section 24, the Income from House Property shall be reduced by the amount of Interest paid on Home Loan where the loan has been taken for the purpose of Purchase/ Construction/ Repair/ Renewal/ Reconstruction of a Residential House Property. The maximum tax deduction allowed under Section 24 in respect of a self-occupied property is subject to a maximum limit of Rs. 2 Lakhs. Besides the above, the amount paid as Repayment of Principal Amount of Home Loan by an Individual/HUF is allowed as tax deduction under Section 80C of the Income Tax Act. The maximum tax deduction allowed under Section 80C has been raised from Rs.1, 00,000 to Rs.1, 50,000.
As per the IT rules, only one certificate can be issued for a home loan and hence one certificate will be issued in the name of both applicant and co-applicant.
IT certificate will be issued at the end of a financial year.
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