Applying for and securing a mortgage against a property, whether residential or commercial, has been quite familiar and chosen option for people whenever they require a significant amount of money. You may have considered it at one point or may already have opted for it when needed. Financial issues are nothing new, and handling that properly means arranging for a substantial fund. If you own some property, it will become easier to secure a loan against it. Unlike selling off your property, a loan against property in Kolkata will be enough to arrange for the money while retaining what you own.

The Notion of getting to Enjoy Tax Benefits on the Loan

The eligibility criteria for such a loan are clear and simple. They can be easily handled by borrowing funds from a recognized lending organization while pledging commercial or residential property as collateral. Such a loan will be a secured loan, leading lenders to offer competitive interest rates, which is more beneficial for you as the applicant. This kind of loan is usually long-term and can go up to twenty years. However, it also comes with an additional benefit that you probably haven’t acknowledged. Whether you are a salaried individual or a self-employed professional, you can claim tax benefits because of this loan.

The Tax Benefit Against Under Section 24 (B)

This tax benefit is suitable for salaried individuals. When the borrowed fund is used for purchasing another residential property, the tax benefit can be claimed, and it can be up to Rs. 2 lakhs. To enjoy this benefit, you will have to establish a link between the loan amount and the end-use, which must be in accordance with Section 24 (B). Apart from that, you can claim tax deductions on the interest paid. However, the principal won’t come under the purview of this facility. If you use the funds for any other purposes such as marriage, education, holiday, and personal entertainment, then tax exemption cannot be claimed.

Tax Benefits on Top-up Loans

Sometimes, along with the loan continuing, you may need some additional funds, and for that, you can choose to opt for top-up loans. These loans have a lower interest rate than personal loans and are perfect for any sudden financial crunch that may come up. If you have all the documents and receipts to establish that the top-up loan taken will be used for acquisition, construction, renovation, repair of a residential property, the tax benefits can be easily claimed. The maximum deductible amount will be Rs. 30,000 and can be claimed only when the property is self-occupied.

The Correlation of Repayment is Essential Information

When it comes to enjoying the tax benefits on loan against property, whether about top-up loans or the primary loan itself, the calculation depends on the principal repayment in correlation to the usage of the fund. Therefore, depending on the use of the fund, the purview of the tax-deductible act will be decided. As it is not easy to gather a clear idea on the subject without proper training and experience, it will be better to hire a professional. They will find out the necessary details and inform you about the whole process in a simple way. This way, enjoying tax benefits on your loan against property will become simple.