# Home Loan Tax Benefit Calculator

> Work out the home-loan interest and principal deductions for a self-occupied house in FY 2025-26 and the tax they save at your slab rate.

Category: India tax & investing · Applies to: India · Last updated: 2026-10-29
Interactive calculator: https://calculators.geekmidst.com/calculators/india-home-loan-tax-benefit-calculator

Under the old regime, interest on a loan for a self-occupied home is deductible up to ₹2 lakh and principal repayment counts towards the ₹1.5 lakh 80C limit. The new regime allows neither.

Also called: Housing loan tax benefit calculator, Section 24(b) calculator.

## Inputs
- Tax regime (options: Old, New; default old)
- Loan for (options: Buying or building, borrowed on or after 1 April 1999, Repairs, or borrowed before 1 April 1999; default purchase)
- Interest paid in the year (default 250000)
- Principal repaid in the year (default 100000; optional)
- Other 80C investments (PF, ELSS, PPF…) (default 80000; optional)
- Your highest slab rate (options: 0%, 5%, 20%, 30%; default 30)
- Currency (default INR)

## Results
- Total deduction
- Interest deduction, section 24(b)
- Principal within 80C
- Approximate tax saved (incl. 4% cess)

## Formula

```
Old regime: Interest deduction = min(Interest, ₹2,00,000 or ₹30,000); Principal deduction = min(Principal, ₹1,50,000 − other 80C); Tax saved ≈ Total × Slab rate × 1.04. New regime: nil for a self-occupied home
```

Where:
- Slab rate: the rate on your top slice of income under the old regime

## Worked example
1. Interest ₹2,50,000 is capped at ₹2,00,000.
2. 80C room = 1,50,000 − 80,000 = ₹70,000, so ₹70,000 of the ₹1,00,000 principal counts.
3. Tax saved ≈ 2,70,000 × 30% × 1.04 = ₹84,240.

**Result:** With ₹2.5 lakh interest and ₹1 lakh principal, the old regime gives ₹2.7 lakh of deductions, saving about ₹84,240 at the 30% slab.

## What the result means

The saving only exists under the old regime; check with the Old vs New Tax Regime Calculator whether the old regime still costs less overall once these deductions are included.

## Assumptions and limits
- FY 2025-26 (AY 2026-27) limits published by the Income Tax Department: interest on a self-occupied home up to ₹2,00,000 for loans for purchase or construction taken on or after 1 April 1999, ₹30,000 for repairs or older loans; combined 80C limit ₹1,50,000, which includes payments for buying or building a house.
- Under the new regime, interest on a self-occupied home and 80C deductions are not allowed (Income Tax Department regime FAQs).
- The tax saved assumes the whole deduction falls in your top slab; surcharge is ignored.
- Let-out property, pre-construction interest, joint loans and sections 80EE / 80EEA are not covered.
- Rules for tax year 2026-27 onwards under the Income-tax Act, 2025 are not covered.

## Rules used
- Jurisdiction: India
- Effective from: 2025-04-01
- Authority: Income Tax Department (CBDT), Finance Act 2025, for FY 2025-26 / AY 2026-27
- Last checked: 2026-10-29

## Questions

### Can I claim home-loan interest in the new regime?

Not for a self-occupied house. The Income Tax Department lists interest on borrowed capital for self-occupied property among deductions not allowed in the new regime.

### Do principal and interest share one limit?

No. Interest is deducted under section 24(b) up to ₹2 lakh; principal falls within the separate ₹1.5 lakh 80C limit, shared with PF, PPF, ELSS and others.

## Sources
- [Income Tax Department — tax rates and deductions for AY 2026-27 (senior citizens page)](https://www.incometax.gov.in/iec/foportal/help/individual/return-applicable-2)
- [Income Tax Department — deductions allowable to taxpayers](https://www.incometaxindia.gov.in/w/deductions-allowable-to-tax-payer)
- [Income Tax Department — FAQs on new vs old tax regime](https://www.incometax.gov.in/iec/foportal/help/new-tax-vs-old-tax-regime-faqs)

## Related calculators
- [Old vs New Tax Regime Calculator](https://calculators.geekmidst.com/calculators/india-old-vs-new-tax-regime-calculator)
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_Tax rules change and depend on how a supply is classified. Use this as a guide and confirm with the official notifications or a tax professional._

Source: GM¹X CalcVerse — https://calculators.geekmidst.com/calculators/india-home-loan-tax-benefit-calculator