When buying a property with loans from specific financial institutions, tax authorities provide certain benefits and exemptions from tax payments.

Section 24 of the Income Tax Act:

An investor is allowed to deduct an amount equivalent to the total interest payable on the housing loan from his/her taxable income within the same financial year. If an investor were to take a loan, he/she would receive a deduction of up to 1.5 lakhs on the interest rate paid. The only concern is that the property would have to be bought or constructed within 3 years from the end of the financial year in which the loan was taken and would have to be self-occupied.

Section 80C of the Income Tax Act:

A deduction u/s 80C (2) (xviii) is available on repayment of the principal during a financial year of up to Rs. 1,00,000/-. This aforesaid limit is within the overall limit of Rs 1 lakh specified in section 80C of the Income Tax Act. Stamp duty, registration fee, or other such expenses paid for the purpose of transfer of such house property to the assessee are also considered under this amount. This deduction is taken from the Gross Total Income.