Deduction on interest paid on home loans. For self-occupied properties, maximum deduction is ₹2,00,000 per year. For rented-out properties, there is no upper limit.
Deduction Limits
- ₹2,00,000 for self-occupied or vacant house (loan from 01.04.1999)
- ₹30,000 for loans taken before 01.04.1999
- ₹30,000 for repair, reconstruction, or renovation loans
- No upper limit if house is rented out
Conditions
- Loan taken on or after 01.04.1999
- House must be acquired or constructed within 5 years of loan
- Certificate from lender required showing principal and interest breakdown
Pre-Construction Interest
- Interest paid before construction is allowed
- Divided into 5 equal installments starting from year of completion
This guide reflects FY 2025-26 (AY 2026-27) and is for general information. Tax rules and limits change, and how they apply depends on your circumstances. It is not professional tax advice; consult a qualified Chartered Accountant before acting.
