Are you planning to buy a home or flat to enjoy tax exemptions? You must have been paying too much of tax as your income is high. But there are ways to overcome this tax problem. Your solution to this would be to buy a home and save on tax too. For this, you must apply for a housing loan so that you can enjoy tax benefits. Income tax Act covers these under two different sections such as: sec 24(b) and section 80(c) of the 1961 income tax act.
Loans will be considered under tax exemption only in the following circumstances. You must have taken a loan from a registered bank or financial institution. Remember that any money borrowed from private agencies, chit funds, friends and family will not qualify for tax benefits.
This will allow you a deduction of up to 1 lakh rupees on the principal amount repaid. Section 24(b) covers the interest payment made to your lender on the borrowed funds. You can qualify for such tax benefits if you have taken a housing loan for construction of house, purchase of house, renovation or repairs of your house are also covered. With the help of these type of borrowed funds you can make use of the loan documents and win a deduction of up to Rs.1,50,000 of your total liability of tax. If your liability is around 40,000, then you save the whole amount.
Carry out your repairs and renovations by availing a small amount of borrowed funds. Refurbish your house and increase the equity value of your house. While you do this, you can make use of these loan papers to save your tax at office. It serves dual benefits isn't it? Then, just go for it...
ULIP funds, insurance policies and tax saver funds can also help you for the same purpose. Learn more about these funds in order to carefully invest in them.
Kirthy Shetty:
kotak.com/Kotak_BankSite/nri/investments/demat-service Demat Account NRI
kotak.com/Kotak_BankSite/nri/home-loans Loan India
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