{"id":13774,"date":"2023-08-29T03:08:12","date_gmt":"2023-08-29T03:08:12","guid":{"rendered":"https:\/\/tata-blog.osian.dev\/blog\/?p=13774"},"modified":"2024-11-11T18:14:10","modified_gmt":"2024-11-11T12:44:10","slug":"can-i-claim-income-tax-exemption-on-loan-taken-for-under-construction-property","status":"publish","type":"post","link":"https:\/\/tata-blog.osian.dev\/blog\/loan-for-home\/can-i-claim-income-tax-exemption-on-loan-taken-for-under-construction-property\/","title":{"rendered":"Can I Claim Income Tax Exemption on Loan Taken for Under-Construction Property?"},"content":{"rendered":"\n

The idea of buying an entirely built and fully furnished house or office is indeed appealing. Further, if you fulfil home loan eligibility criteria<\/a> and are sanctioned housing finance, you may be tempted to seal the deal even faster. But, before that, take a step back to consider that complete properties might just end up costing you more than you can afford.<\/p>\n\n\n\n

This is why, in certain scenarios, purchasing an under-construction property can work in your favour as you can get a price quote that is 20% lower than you get on a completed one. Moreover, you can also get housing loan tax exemption for under-construction propertyin addition to other financial advantages.<\/p>\n\n\n\n

Tax exemption on home loan interest for under-construction property<\/strong><\/h2>\n\n\n\n

You can claim a tax exemption of up to Rs. 2,00,000 on the interest payments made in a year and deductions of up to Rs. 1,50,000 on the principal amount paid, under Section 80C of the Income Tax Act (ITA).<\/p>\n\n\n\n

It is worth noting that the tax reliefs are not applicable in case the loan amount is utilised for renovation purposes.<\/p>\n\n\n\n

Further, Section 24 of the Income Tax Act states that an under-construction property is free from any type of tax for interest paid on EMIs. Also, tax exemption is inapplicable if the housing loan for an under-construction property is availed for purchasing a plot.<\/p>\n\n\n\n

Bonus tip: Ensure you check and compare various home loan ratesvigilantly, before applying.<\/p>\n\n\n\n

Additional Read:<\/strong> Which One is Better? Under- Construction or Ready-to-Move-In House<\/a><\/p>\n\n\n\n

Tax benefits when you take housing finance for an under-construction property<\/strong><\/h2>\n\n\n\n