Housing Loan for second House

Residential loan for the second house

Mortgage credit for your second home advantages for taxation - Mortgage Blog You have many good reason to want a second home, and the good thing is that you no longer have to be really wealthy to have one. When you have taken out a loan for your first house, should you also take out a loan for the second one? In order to begin with, say that you live in a house that you have purchased on loan. We all know that in this case the amount of capital repayable up to 1akh qualifies for relief under Section 80C of the Income Act, 1961, while up to 1.5 leakages of interest payments are eligible for relief under Section 24(b).

Well, if you choose to buy a second home by taking out another loan, you are still entitled to make discounts not on the amount of capital but on interest thereon. This means that if you pay an interest rate of about 5 lachs, the total amount is deductible according to the required form.

Don't worry, this second option will surely persuade you to relax your wallet. Suppose you are living in Mumbai, but choose to buy a home in your home town of Pune because of its emotional value. That' s how you choose to let it for a certain amount. These second properties are regarded as "leased" houses.

Salmon 5 as a rental for your second home, which is regarded as an annuity. As a lump sum of 30% on the rented real estate is permitted, the amount will amount to 45000 INR. Moreover, let's suppose that you pay Rs.1. 4 leakages as interest on the loan taken for second home.

Second house income: Here are a few more things to keep in mind before you can fully take advantage of the full benefit of your second home relief. If the house is self-inhabited, what happens? 1967 incomes tax states that if you own more than one house, then on that which you declare as selfoccupied, its yearly income is regarded as zero.

Likewise, the lease value of the second real estate is taken into account for tax calculation as well. So if you are declaring your second house as a leased object, all the revenue you generate from your rents is taxable. But what if you kept your second house empty and didn't let it?

Unless you have designated your second real estate as self-occupied and have not let it, it will be regarded as a "rented property" despite a lack of revenue from rents. Under such a situation, the fictitious lease, the revenue you would have received if you had let the house, will be valued on the unoccupied plot and the same will be subject to tax.

In addition, you can deduct 30% from all costs of repairs and servicing for second home units. If your second home is under building, what happens? When you choose to make an investment in a home under development, 20% of the interest payable during the prefabrication period is granted as a deductible amount.

Nevertheless, this preferential rate of taxes on the house before building is valid for a period of five years. How will the fiscal impact be if you choose to let your second home and your first one? Once you have decided to let all your homes, the rents you get from these homes will be taxable.

A full discount on the amount to be disbursed as interest on the corresponding home loan will also be permitted, so you can make substantial savings. Thus, investments in a second home can be advantageous, both in respect of fiscal advantages and from the investors' point of view, so you should certainly consider it!

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