Check out How much Tax I Can Save on Home Loan

Home Loan Tax Saving Calculator

Check out How much Tax I Can Save on Home Loan

✓ Home Loan from ₹5 Lakhs To ₹5 Cr ✓ Multiple Lending Partners ✓ Attractive Interest Rates

The Government of India has taken multiple steps to make things better for prospective home buyers. As the majority of home buyers take out a loan to buy a new house, the government allows the deduction of a certain portion of the interest and the principal amount from the net taxable income of the borrowers. You can use the home loan tax saving calculator to get an estimate of the amount of tax that you can save by claiming income tax deductions against your home loan EMIs.

Home Loan Tax Saving Calculator

You can use the Home Loan Tax Saving Calculator on Bajaj MARKETS to calculate the total tax benefit that you can get on your home loan. The calculator is simple and has an easy-to-use interface. All you have to do is enter the following details in the designated fields of the calculator:

  • Loan Amount

  • Rate of Interest

  • Loan Tenure

  • Loan Start Date

The calculator will give you an estimate of the income tax that you can save on the principal and interest amounts of your home loan.

Let us try to understand this with the help of an example. Let’s say your annual income is ₹12,00,000 and you have taken a home loan of ₹50,00,000 for a tenure of 20 years. Your tax savings on the house loan can be calculated as per the following table:

Principal Home Loan Amount

₹50,00,000

Annual Income

₹12,00,000

Home Loan tenure

20 Years

Home Loan Interest Rate

7% per annum

Other 80(C) Investments

₹1,00,000

Tax Before Home Loan

₹1,42,500

Tax After Home Loan

₹82,500

Tax Savings Because of Home Loan

₹60,000

Tax Benefits on Home Loan

As mentioned earlier, if you buy a new house by taking a loan from a bank, a certain portion of the principal and the interest amount of the loan is deducted from your net taxable income. As a result, you end up saving on your income tax outgo. The following pointers explain the home loan tax benefits that you can avail on your home loan:

  • You can claim a deduction of up to ₹1.5 Lakhs from your net taxable income on the principal amount under Section 80(C) of the Income Tax Act, 1961

  • You can also claim a deduction of up to ₹2 Lakhs from your net taxable income on the interest amount under Section 24 of the Income Tax Act

  • In the case of joint home loans, the aforementioned deductions can be claimed by all the co-borrowers separately

  • If you are a first-time homebuyer and the loan amount is less than ₹35 Lakhs, you can claim an additional deduction of up to ₹50,000 on the interest amount under Section 80EE of the Income Tax Act

Home Loan Tax Saving Calculator FAQs

  • ✔️How much tax can be saved on a home loan?

    You can claim a deduction of up to ₹2 Lakhs on the interest amount under Section 24 and a deduction of up to ₹1.5 Lakhs on the principal amount under Section 80C of the Income Tax Act, 1961. Additionally, if you have taken a home loan for the first time and the loan amount is less than ₹35 Lakhs, you also get a deduction of ₹50,000 under Section 80EE from your taxable income, which is over and above the aforementioned deductions.

  • ✔️How is tax exemption calculated for home loans?

    You can calculate the tax exemption based on your income tax slab and the principal and the interest portions of your house loan EMIs.

  • ✔️How to calculate tax savings on a home loan?

    You can simply use the Home Loan Tax Saving Calculator on Bajaj MARKETS to get an estimate of the tax amount you can save by availing the benefits of the various deductions under the Income Tax Act, 1961.