Question: Is Top up loan eligible for tax exemption?

Is interest on top-up loan eligible for tax exemption?

These include a deduction of up to Rs 1.5 lakh on the principal repayment under section 80C of the income tax Act and up to Rs 2 lakh on the interest paid under section 24 in a single financial year. … Yes, you can claim a tax benefit if you have taken a top-up on your home loan.

Which loans are eligible for tax exemption?

Let’s throw light on three important loans that qualify for a tax rebate as per the provisions of the Income Tax Act, 1961.

  • Education Loan Repayment: Deductions Under Section 80E. …
  • Home Loans: Deductions/Subsidy Under Section 80C, Section 24, 80EE, 80EEA, CLSS. …
  • Personal Loans: Indirect Deductions as per Use of the Loan.

Can we show personal loan for tax exemption?

Section 24(b) of the Income Tax Act, 1961, allows for a tax rebate on a personal loan if the amount is used for home renovation or improvement. In this case, interest paid on a personal loan repayment up to Rs. 30,000 can be claimed as deduction from the total taxable income.

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What is the benefit of top-up loan?

Low-Interest Rates – The major benefit of the top-up loan is that it can be availed at low-interest rates as compared to a personal or gold loan. The regular personal loan interest rates vary between 11-24%, but for a top-up loan, the interest rates are the same as home loan interest rates.

Is mortgage loan eligible for tax exemption?

Yes, a loan against property enables you to save on the tax amount payable. … Salaried individuals can also claim benefits under Section 24(B) of the Income Tax Act if the borrowed funds are utilized for funding the purchase of another residential property. The maximum deduction one can claim is Rs. 2 lakh.

Can I get tax benefit on top up home loan?

A top-up home loan is eligible for tax benefits under Section 80C and Section 24 if it has been utilised for acquisition/ construction of residential property or renovation of the said property. You can split the EMI and take income tax exemption under Section 80C and Section 24, individually.

Can we get tax exemption on car loan?

Yes, a Car Loan can help you save on tax if you are a self-employed professional or business owner and use the car for business purposes. But a salaried employee cannot claim tax deductions on Car Loan interest repayments like with a Home Loan. The reason behind this is that a car is considered as a luxury product.

How much loan can I get based on ITR?

The entire amount of interest repaid can be claimed as a tax deduction on the property, which is let-out (up to a maximum of Rs. 200,000 for each year). Under Section 80 C, the principal loan amount repaid can be claimed for tax deductions (up to Rs. 1, 50,000).

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Can I save tax by taking loan?

Tax benefits on personal loans

In case of house improvement and construction of property, you can claim deductions under Section 24 and Section 80C as mentioned above – so yes, if personal loan funds are used towards these purposes, you will be eligible for exemptions under Section 24 and 80C.

Can I get personal loan on ITR?

Yes, if you have filed ITR for a minimum of 2-3 years, you can get a personal loan on ITR.

How can I reduce my taxable income?

Save Income Tax on Salary

  1. Deductions under Section 80C, Section 80CCC and Section 80CCD. Citizens of India can save tax under these 3 sections. …
  2. Medical Expenses. …
  3. Home Loan. …
  4. Education Loan. …
  5. Shares and Mutual Funds. …
  6. Long Term Capital Gains. …
  7. Sale of Equity Shares. …
  8. Donations.