Filing ITR under old regime? Claim these 5 home loan tax benefits

India Today

25-07-2025

Owning a home is a big milestone, but did you know it can also help you save a good amount of tax? If you are paying off a home loan, there are smart ways to reduce your tax bill when you file your Income Tax Return (ITR) for the financial year 2024-25. Many homeowners often miss out on these benefits simply because they don't know about them or forget to claim them on time.advertisementHere's a simple guide to five key home loan tax benefits you can claim under the old tax regime while filing your ITR this year.DEDUCTION ON HOME LOAN INTEREST UNDER SECTION 24(B)If you live in your own house, you can claim a maximum deduction of up to Rs 2 lakh every year on the interest paid for your home loan under Section 24(b).
For properties that are let out, there is no limit on the interest deduction. You can claim full interest paid as a deduction against your rental income. However, you can set off only a Rs 2 lakh loss from house property against other income in one year. The remaining loss can be carried forward for up to eight years.Good news, from this year, you can treat two properties as self-occupied for tax purposes, which makes tax planning easier for families with more than one home.CLAIM PRINCIPAL REPAYMENT UNDER SECTION 80CIf you are repaying the principal part of your home loan, you can claim a tax deduction of up to Rs 1.5 lakh every year under Section 80C. This limit also covers stamp duty and registration charges, but you can claim this only once you get possession of your property and hold it for at least five years.EXTRA DEDUCTION FOR FIRST-TIME BUYERSFirst-time home buyers can claim even more savings. If you got your home loan approved during FY 2016-17, you may claim an extra Rs 50,000 under Section 80EE. If you bought an affordable house between April 2019 and March 2022, Section 80EEA allows you to claim up to Rs 1.5 lakh more.But remember, you can claim only one of these, not both.SAVE CAPITAL GAINS TAX UNDER SECTION 54If you sell a house and make a profit, you can avoid paying tax on that profit if you use it to buy or build another house in India. Under Section 54, you can buy the new house within one year before or two years after selling the old one, or build it within three years.You can claim this even if you take a loan for the new house, and still claim other deductions on the loan too.JOINT HOME LOAN? DOUBLE THE BENEFITSadvertisementIf you take a joint home loan with a co-owner, like your spouse, you can both claim separate deductions on the principal and interest. So, under Section 80C and Section 24(b), you can both claim individually, which means double the tax savings for the same property.However, one must remember that all these above benefits are available only under the old tax regime. If you have a big home loan, the old regime could be more useful as the new regime does not allow these deductions. So, keep all your loan papers, bank statements and interest certificates ready when you file your ITR for Assessment Year 2025-26.- Ends