What is the impact of Direct tax code on housing loan?

Q: I want to take home loan to buy an apartment. What is the impact of Direct tax code on housing loan?

Neha Srivastava, Delhi-NCR

29th September 2011

Other in Delhi

direct tax code on housing loan

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At present the repayment of principal amount of housing loan is eligible for tax exemption under section 80C of the Income Tax Act, 1961. Under the proposed DTC, this privilege will be taken off and the tax payers will have to look at other options of investments for claiming tax exemption. On the other hand, deduction under section 24(b) of the Income Tax Act, 1961 towards interest paid on housing loan which was available from the "Income from House property" will not be available under proposed section 74 from Gross total income.