How to Use a Home Loan Tax Benefit Calculator to Check Savings | Kotak Mahindra Bank - Home Loan Stories
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18 JANUARY, 2022

One of the best benefits that you must definitely explore while availing home loans is its tax deductions. While a home loan helps you buy your dream house, it also helps you save. Often people are not aware of the tax deductions and miss out on claiming them while filing income tax returns. Moreover, if you are not well versed with the taxation provisions, you might find it challenging to check the tax benefit amount.

In such a situation, a home loan tax benefit calculator can be a great help. Continue reading to know more.

What Are The Tax Deductions on Home Loans?

  • Tax deductions on Principal -You can claim a tax deduction of up to Rs 1,50,000 on principal payment as per section 80C of the Income Tax Act 1961 in a financial year. This includes the amount paid for stamp duty and registration charges as well.
  • Tax deductions on Interest -You can also claim tax deductions on the interest repayment under section 24 (b) up to an amount of Rs 2 lakh.
  • If you are a first time home loan borrower, you can claim an additional deduction of Rs 50,000 on the interest payment under section 80EE. However, the loan amount should be less than Rs 35 lakh, and the house value should be under Rs 50 lakh.

What Is a Tax Benefit Calculator?

The home loan tax benefit calculator is an online tool that you can use to know the tax amount to be paid after considering all the eligible tax deductions. Through this calculator, you can find the total amount of tax deductions you can claim from the home loan repayment.

How To Use a Tax Benefit Calculator?

  • Visit the lender's website and click on the home loan tab
  • Click on the tax benefit calculator
  • Choose the financial year
  • Choose the category - either male or female.
  • Find the relevant values as required. Enter your annual income
  • Enter the investments eligible for deductions under section 80C
  • Enter the value for home loan principal
  • Enter your loan tenure
  • Enter your current interest rate
  • See the results displayed below.

Benefits of Home Loan Tax Benefit Calculator

  • Instant results -With this calculator, you can see savings made by repaying the home loan, taxes you had to pay before the loan, and taxes to be paid after availing the loan. With this calculator, you can calculate the amount of tax you will save by availing a housing loan.
  • User friendly -You can find this calculator on the lender’s website and use it any number of times. It shows instant results, is simple to use and user friendly.
  • Safe to use -You need not furnish your name, phone number or any other personal details to use this calculator. All you have to do is, enter values of gross annual income, deductions on principal and interest repayment.

A home loan tax benefit calculator can help you know your total tax savings and plan your home loan in a better manner. By knowing your taxability, you can plan your budget efficiently and save money. So wait no more. Use a tax benefit calculator and apply for a home loan now.

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.