InvestorQ : What will happen if the Finance Minister hikes the deduction limit for interest paid on housing loan for self-occupied properties?
Ashok Patkar made post

What will happen if the Finance Minister hikes the deduction limit for interest paid on housing loan for self-occupied properties?

Answer
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1 year ago


Just like the expectation that the government should increase the Section 80C deduction limit from Rs 1.5 lakh to Rs 2 lakh, there has been yet another long-standing demand from the working class or the aam aadmi. This demand is to increase the deduction amount for self-occupied properties from Rs 2 lakh to Rs 2.5 lakh. If the Finance Minister Piyush Goyal delivers on this expectation, then it would help individuals who pay interest on their home loans for self-occupied properties save more tax. Here is how much more tax individuals can save if they pay Rs 2.5 lakh or more towards their home loan interest: - If you have a taxable income up to Rs 5 lakh, then you stand to save tax up to Rs 2,500 (5% of Rs 50,000 excluding cess) if you exhaust the entire Rs 50,000 additional limit provided in tax-saving instruments. - If you have a taxable income up to Rs 10 lakh, then you stand to save tax up to Rs 10,000 (20% of Rs 50,000 excluding cess), if you exhaust the entire Rs 50,000 additional limit provided in tax-saving instruments. - If you have taxable income above Rs 10 lakh, then you would be able to save tax up to Rs 15,000 (30% of Rs 50,000 excluding cess and surcharge, where applicable), if you exhaust the entire Rs 50,000 additional limit provided in tax-saving instruments.