Buying a house offers a lot of Tax Advantages, make sure you dont miss out on them.
1. Before you buy
If you are buying your house for the first time, Make sure you take the help of a Lawyer to check on your documents before you buy. Obtain an encumbrance certificate from the relevant Register Office and ensure the property is free of any holdings.
2. Financing your house
Picking a loan to fund your house would be a good idea. Any interest you pay on a Housing Loan is deductable from the taxable income. Make sure you take help from an Investment consultant in planning the tenure of the house and the interest option. ( Banks generally offer a Fixed rate or a Floating Rate )
3. Qualifying for the tax deduction
If you have let out the property, you qualify to the full amount. If you decide to occupy the house yourself, you qualify to a maximum of Rs. 1,50,000/- on your Interest payment. Your principle repayment goes towards fulfilling the balance of 80C deductions. Further, If you have let out your house, you can claim deductions on Municipal Taxes, Water Taxes and other Property Taxes. Make sure you pick your Interest Certificate and the Tax Receipts at the end of the year.