Faqs - L&T Finance

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Is a Loan Against Property taxable?

No, the amount borrowed through a Loan Against Property is not considered taxable income. However, you are required to pay tax on the income you generate using the loan amount.

How much ITR is required for a Loan Against Property?

Lenders typically require at least the last 2 years’ Income Tax Returns (ITRs), but this can vary based on the loan amount and lender policies.

Can a Loan Against Property be converted to a home loan?

No, loans against property and home loans serve different purposes and follow distinct guidelines.

Does a Loan Against Property come under 80C?

Only if the loan amount is used to acquire or construct a residential property it qualifies under Section 80C.

What are the differences between tax benefits on a Loan Against Property and a home loan?

Home Loans qualify for both principal (Section 80C) and interest (Section 24(b)) deductions.Loan Against Property offers limited tax benefits based on its usage.

How does repayment tenure influence the tax benefits on mortgage loans?

Longer tenures spread out interest payments, maximising annual tax exemptions.

Can tax benefits be claimed on pre-EMI payments for a Loan Against Property?

Tax benefits cannot be claimed until the property’s construction is complete.

Are co-borrowers eligible for separate tax benefits on a joint Loan Against Property?

Yes, co-borrowers can claim tax benefits based on their share in the loan repayment, provided they meet eligibility conditions.

Does refinancing a Loan Against Property affect eligibility for tax deductions?

No, refinancing does not affect the benefits, but the renewed loan must still qualify under the eligible usage criteria.

Is there a cap on the interest deductible for tax purposes on mortgage loans?

Yes, the cap is typically ₹ 2 Lakh annually under Section 24(b), except for business-specific loans under Section 37(1), which allow broader claims.

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