Search:

Saving Tax with Loans in India

"Saving Tax" on your income is always a spot of interest for each one of us and why not when there is a legal way?

Saving Tax is easier under Indian Income Tax Act if one opts for the home loan. There are two sections of Indian Income Tax which allow you to avail this benefit.

1) Indian Income Tax Act 1961, Section 24 (B)
2) Indian Income Tax Act 1961, Section 80 (C..)

If proper investments are made then you can get a total deduction of Rs. 2.5 lacs per year. Under section 24, one can save up to Rs. 1.5 Lacs and under section 80 save up to Rs. 1 Lacs.

The Section 24(b) of the Income Tax Act, 1961 is applicable on Home loan for purchase of house or construction of the house property. You can avail a deduction of up to Rs. 1,50,000 of you total tax liability, Also reconstruction or renewal or repairs is eligible for deductions under the said section.

The Section 80(c) of the Income Tax Act, 1961 allows you a deduction of up to Rs. 1,00,000 on the principal repayment amount.
Example Suppose your total taxable income is Rs. 6,00,000. Hence now your total taxable income becomes only (6 - 2.5 - 1 Lacs) and that saves a lot of money!

With property rates increasing at 300% an year, literally tripling your asset worth in an year, makes investment in property a nice avenue for "guaranteed profits" on investments. To make it even better you can save on taxes if you purchase a property for self -- through the loan mechanism.

Saving Tax is legal and has never been easier.

Free Article Source: http://www.za77.org

Naveen Narale is an MBA from Mumbai University with an interest in finance, systems and online business. Find out more on Loan in India at: www.loanindia.in

Please Rate this Article

Not yet Rated

Click the XML Icon Above to Receive Finance Articles Via RSS!

Additional Articles From Free Article Center's Finance Category

A Debt Management Primer - By : Martin Sumner
Student Credit Cards - A Lesson In Money Management - By : Derek Lenehan
Are Secured Credit Cards Your Choice? - By : Julia Maupin
3 Things to Consider Before You Submit That Prepaid Credit Card Application - By : Max Anderson
Three Things You Should Know Before Buying a Business Franchise - By : Robert Thomson
Credit Cards - Are You Hooked - By : Arthor Pens
Student Loan Consolidation - By : Elise Fisher
Business Finance - By : Carolyn
Signs That A Loan Site Is Trustworthy - By : Martin Sumner
How to Pay for College - By : Blake Provo

	Print This Article
	Post Comment
	Add To Favorites
	Email to Friends
	Ezine Ready

Submit Articles
Member Login
Top Authors
Most Popular Articles
Submission Guidelines
Ezine Notifications
Article RSS Feeds

Write a professional-quality article for fame, fortune or web traffic in one day. Fail-safe method that any one can use!

Site News
About Us
Link to Us
Contact Us
Privacy Policy
Terms of Service