All You Need to Know About NRI Home Loans in India

Any individual who has taken a home loan for purchasing, constructing, or renovating a residential property can claim tax deductions. The borrower must be the owner or co-owner of the property and repay the loan using their own income. NRIs can also claim similar tax benefits under Sections 24(b), 80C, and 80EE of the Income Tax Act.

The total tax savings depend on your loan amount, interest rate, repayment structure, and your tax slab:

• Under Section 24(b): You can claim up to Rs. 2 lakh on the interest paid.
• Under Section 80C: You can claim up to Rs. 1.5 lakh on the principal repayment. 

It means you can save up to Rs. 3.5 lakh in a financial year. If you fall under the 30% tax slab, the maximum saving can be around Rs. 1.05 lakh per annum.

Yes, you can claim both HRA (House Rent Allowance) and home loan tax benefits at the same time, but only if you live in a rented house while repaying a home loan for another property.

Yes, you can claim tax benefits on a second home loan also. The interest paid on the second home can be fully deducted under Section 24 (b) with no upper limit. However, the total loss incurred from house property that can be set off against other income is capped at Rs. 2 lakh annually. Additionally, there is no deduction under section 80C for principal repayment on the second home.

You can enjoy several tax benefits on your home loan under these sections:

• Section 80C: Deduction up to Rs. 1.5 lakh on principal repayment.
• Section 24 (b): Deduction up to Rs. 2 lakh on interest paid.
• Section 80EE/80EEA: Additional deduction of Rs. 50,000 or Rs. 1.5 lakh for first-time homebuyers (based on eligibility). 
• Stamp Duty and Registration: Deduction under Section 80C (within Rs. 1.5 lakh limit). 

In case you are a first-time buyer, you can claim a combined deduction of up to Rs. 5 lakh. However, these limits depend on eligibility and the prevailing rules of the financial year: 

• Rs. 1.5 lakh under Section 80C (principal)
• Rs. 2 lakh under Section 24 (b) (interest)
• Rs. 1.5 lakh under Section 80EEA (additional for affordable housing).