Interest and repayment of loan for repairing house

Following tax benefits are available on home improvement loan in India:
Interest Repayment (under section 24)
Tax deduction on the interest paid of upto Rs. 30,000 is allowed on home improvement loan. In case of self-occupied property, this limit will be part of the overall tax deduction limit of Rs. 2,00,000 towards interest repayment allowed under section 24. 

If the home improvement loan is taken for second home, you can claim tax deduction on interest repaid of upto Rs. 30,000 over and above the interest repayment of your home loan.

If the house is owned jointly, both co-owners can claim the tax benefit on interest repayment upto Rs. 30,000 separately.

Principal Repayment (under section 80C)
No tax deduction is allowed on principal repayment of home renovation loan. 

Yes 30000 deduction is allowed if loan is taken for renovation under section 24, however no deduction is allowed for repayment of principal amount also the set off limit is 2 lakh so if you are already having housing loan then this won't be that beneficial.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

- Yes in addition to the interest on construction loan,  interest on repair/renovation loan will be allowed upto Rs.30K. Section 24(b)

- No deduction allowed on account of principal repayment on renovation loan.

Hello,

Yes, you will get deduction for interest on loan taken for repairs of the house under section 24 upto Rs. 30000 per year. Further this deduction will be in addition to the interest on construction of house but the total deduction available from both the loans will be limited to Rs. 2,00,000.

And deduction for principal repayment of loan for repairs will not be available. So you will not get that benefit on loan for house repairs.

I hope this answer satisfies your requirement.

Regards,

CA Hunny Badlani

Hi,

Interest on borrowed capital for rennovaren of house is allowed as deduction u/s 24. The deduction will be allowed upto maximum 30k in case of self occupied property.

The section is reproduced below:

24. Income chargeable under the head "Income from house property" shall be computed after making the following deductions, namely:—

(a) a sum equal to thirty per cent of the annual value;

(b) where the property has been acquired, constructed, repaired, renewed or reconstructed with borrowed capital, the amount of any interest payable on such capital:

Provided that in respect of property referred to in sub-section (2) ofsection 23, the amount of deduction 40[or, as the case may be, the aggregate of the amount of deduction] shall not exceed thirty thousand rupees :

Repayment of principal is not allowed as deduction.

Hi

Interest paid will be allowed as deduction under sec 24 of income tax act. Principal repayment will not be allowed.

Hope it helps 

Hi,

A loan taken for renovating an existing house after the completion certificate is issued, or after the house has been let out/occupied is not eligible for tax deductions under Section 80C. However, the interest component is eligible for deduction under Section 24(B) under the head, “income from house property”. You are eligible for tax deductions up to Rs. 30,000 per annum on the interest paid on the home loan improvement.