How to Claim Tax Deductions on Home Loan – Section 80C, 24(b), and More (2025 Guide)
If you’ve taken a home loan, you can claim tax deductions under various sections of the Income Tax Act. This 2025 guide explains how to save money using Section 80C, Section 24(b), and Section 80EE/80EEA — with eligibility, limits, and tips.
🧾 Key Sections for Home Loan Tax Benefits
| Section | Benefit On | Max Deduction | Eligibility |
| 80C | Principal repayment | ₹1.5 Lakhs | Only if the house is not sold within 5 years |
| 24(b) | Interest paid | ₹2 Lakhs (self-occupied) | No limit for rented homes |
| 80EE | Extra interest (first-time buyers) | ₹50,000 | Loan < ₹35L, property < ₹50L |
| 80EEA | Extra interest (affordable homes) | ₹1.5 Lakhs | Property value < ₹45L (loan between Apr 2019–Mar 2022)* |
📌 Note: Section 80EEA was only for loans sanctioned until March 31, 2022 (unless extended further).
✅ 1. Section 80C – Deduction on Principal Repayment
What’s Covered:
- EMI principal component
- Stamp duty and registration charges (one-time, in the same year)
Conditions:
- Property must not be sold for 5 years
- Maximum limit: ₹1.5 Lakhs/year (combined with other 80C investments like PPF, ELSS, LIC)
Example:
You paid ₹90,000 in principal + ₹60,000 in stamp duty ➡ Claim full ₹1.5 Lakhs under Section 80C
✅ 2. Section 24(b) – Deduction on Home Loan Interest
What’s Covered:
- Interest portion of EMIs
Deduction Limits:
- ₹2 Lakhs/year for self-occupied property
- No limit for rented-out properties
Conditions:
- Loan must be taken for purchase/construction
- Construction should be completed within 5 years
📌 Pre-construction interest can be claimed in 5 equal installments starting from possession year
✅ 3. Section 80EE – Additional ₹50,000 Interest Deduction
Eligibility:
- You’re a first-time home buyer
- Loan sanctioned between FY 2016–17
- Loan amount ≤ ₹35 Lakhs
- Property value ≤ ₹50 Lakhs
- Loan taken from a bank or HFC
➡ Deduction is over and above Section 24(b)
✅ 4. Section 80EEA – Additional ₹1.5 Lakhs for Affordable Homes
Eligibility:
- Loan sanctioned between Apr 1, 2019 – Mar 31, 2022
- Property value ≤ ₹45 Lakhs
- Applicant must be first-time buyer
- Must not claim deduction under Section 80EE
➡ Claim up to ₹1.5 Lakhs extra interest deduction (on top of ₹2L under Section 24(b))
📌 Check if government extends this benefit in Budget 2025
🧾 Documents Required for Claiming Tax Benefits
- Loan interest certificate from the bank
- Loan sanction letter
- Proof of principal repayment (loan statements)
- Possession/Completion certificate
- Property ownership papers
- PAN of co-owner (if any)
🏡 Can Co-Owners Claim Deduction Separately?
Yes — if both are:
- Co-owners of the property
- Co-borrowers of the loan
Each can claim:
- ₹2 Lakhs interest under 24(b)
- ₹1.5 Lakhs principal under 80C
✅ Doubles your tax-saving potential
💡 Tips to Maximize Tax Benefits
- Choose joint ownership with spouse to split deductions
- Track EMI breakdown (interest vs principal) annually
- For under-construction homes: maintain pre-EMI interest record
- Submit investment proofs to employer to avoid higher TDS
📊 Quick Comparison Table
| Section | What It Covers | Max Deduction | First-Time Buyer Benefit? |
| 80C | Principal, stamp duty | ₹1.5L | Yes |
| 24(b) | Interest on home loan | ₹2L | Yes |
| 80EE | Extra interest (older rule) | ₹50K | Yes |
| 80EEA | Extra interest (affordable) | ₹1.5L | Yes |
💬 FAQs – Tax Deductions on Home Loan
- Can I claim 80C and 24(b) together? ➡ Yes, both principal and interest are separate claims.
- Can I claim tax deduction before possession? ➡ Only pre-construction interest under 24(b) — in 5 equal parts after possession.
- Is stamp duty deductible under 80C? ➡ Yes, but only in the year of payment.
- Can I claim both 80EE and 80EEA? ➡ No. You can claim only one, not both.
📞 Final Thoughts + CTA
Don’t miss out on home loan tax deductions — they can help you save up to ₹5 Lakhs/year if planned smartly. Use every section that applies based on your property, loan, and ownership structure.
💬 Need help calculating your home loan tax savings? 👉 Chat with our tax advisor on WhatsApp or Submit your loan details here — we’ll send you a personalized tax deduction report.
✅ Categories:
- Tax Saving Guide
- Home Loan Benefits
- First-Time Buyer Tips