Home Loan Tax Benefit Calculator 2026-27
The deductions a home loan earns in 2026-27 under the Income-tax Act, 2025: interest on a self-occupied or let-out house and principal within the ₹1.5 lakh limit.
Result
Old regime: total deduction: ₹2,90,000Estimate
Old-regime figures. Slab savings ignore surcharge and rebate; first-time buyer deductions under the 1961 Act are not covered.
- Old regime: tax saved, with cess
- ₹90,480Estimate
- Income from house property (minus is a loss)
- -₹2,00,000Estimate
- Loss set off against other income
- ₹2,00,000Estimate
- Loss carried forward
- ₹0Estimate
- Principal within the ₹1.5 lakh limit
- ₹90,000Estimate
- New regime: interest deducted from rent
- ₹0Estimate
https://calcgallery.com/income-tax/home-loan-tax-benefit-calculator/
An estimate from the published rates for the tax year shown, for the situation described on this page. It is not a tax return or tax advice. Rules change with each budget, and your own circumstances can change the answer. Check it against your payslip and the tax authority’s own calculator, and confirm anything that matters with a qualified tax adviser. Read the full disclaimer
How to use the Home Loan Tax Benefit Calculator 2026-27
- Say whether you live in the house or let it out.
- Enter the interest and principal you repaid this year, and your other Schedule XV (old 80C) investments such as EPF and PPF.
- For a let-out house, enter the rent and municipal tax. For your own home, say whether you bought or built it within five years of the loan.
- Choose your old-regime slab to see the tax saved, and compare the new-regime figure.
A house you live in
The Income-tax Act, 2025 treats the annual value of a self-occupied house as nil, so the interest becomes a loss under house property. Under the old regime it is capped at ₹2,00,000, or ₹30,000 if the house was not acquired or built within five years. Under the new regime nothing is allowed.
A house you let out
The page works from the rent down:
annual value = rent − municipal tax paidless 30% standard deductionless all the interest= income or loss from house propertyRent of ₹3,00,000, municipal tax of ₹20,000 and interest of ₹3,50,000 give an annual value of ₹2,80,000. The standard deduction is ₹84,000, so before interest the income is ₹1,96,000, and after interest it is a loss of ₹1,54,000. Under the old regime the whole loss is set off against your salary. Under the new regime the interest only cancels the ₹1,96,000 of rent income.
Principal
Principal sits inside the Schedule XV limit of ₹1,50,000. The page shows only the part of the principal that fits after your other investments. With ₹60,000 of other investments and ₹1,20,000 of principal, ₹90,000 of the principal counts.
Limits
Tax saved is the deduction times your slab rate plus 4% cess. It ignores surcharge, the rebate and the chance that a deduction moves you to a lower slab. Joint borrowers each claim their own share. The extra deductions for first-time buyers under the old 1961 Act are not covered.
With your numbers
- Self-occupied interest is capped at ₹2 lakh in the old regime only
- A let-out loss sets off up to ₹2 lakh in the old regime; the new regime allows none
Quick reference
Old-regime figures. Slab savings ignore surcharge and rebate; first-time buyer deductions under the 1961 Act are not covered.
| Example | Old regime: total deduction |
|---|---|
| Self-occupied, ₹2.5 lakh interest | ₹2,90,000 |
| Self-occupied, ₹1.5 lakh interest | ₹2,40,000 |
| Built late, ₹2 lakh interest | ₹1,20,000 |
| Let out, ₹3 lakh rent, ₹3.5 lakh interest | ₹4,40,000 |
| Let out, ₹6 lakh interest | ₹4,51,000 |
| 20% slab, ₹1 lakh interest | ₹1,90,000 |
Where the numbers come from
The fixed figures this calculator relies on, and the published source each one was checked against. How the calculators are built and checked
6 sources
Income-tax Act, 2025 (Act 30 of 2025) as amended by the Finance Act 2026, https://www.incometaxindia.gov.in/income-tax-act-2025, s.22(2)(a)
Used for
- Limit on interest on a loan for a self-occupied house (old section 24(b)).
Income-tax Act, 2025 (Act 30 of 2025) as amended by the Finance Act 2026, https://www.incometaxindia.gov.in/income-tax-act-2025, s.22(2)(b)
Used for
- Limit on self-occupied home loan interest when the loan is for repairs, or the house was not bought or built within five years.
Income-tax Act, 2025 (Act 30 of 2025) as amended by the Finance Act 2026, https://www.incometaxindia.gov.in/income-tax-act-2025, s.22(1)(a)
Used for
- House property: standard deduction of 30% of the annual value of a let-out property.
Income-tax Act, 2025 (Act 30 of 2025) as amended by the Finance Act 2026, https://www.incometaxindia.gov.in/income-tax-act-2025, s.109(1)(b)
Used for
- Old regime: a house property loss is set off against other income only up to ₹2,00,000 a year.
Income-tax Act, 2025 (Act 30 of 2025) as amended by the Finance Act 2026, https://www.incometaxindia.gov.in/income-tax-act-2025, s.123 and Schedule XV
Used for
- Aggregate limit on Schedule XV investments (old section 80C), including employee EPF and your own NPS.
Finance Act 2026 (Act 4 of 2026), https://www.incometaxindia.gov.in/finance-acts, as in the Finance Bill 2026, https://www.indiabudget.gov.in/doc/Finance_Bill.pdf, clause 3(15)
Used for
- Health and Education Cess on income tax plus surcharge, with no marginal relief.
Common questions about the Home Loan Tax Benefit Calculator 2026-27
- How much home loan interest can I deduct?
- For a house you live in, up to ₹2,00,000 a year under the old regime, if you bought or built it within five years of the end of the year you took the loan. Otherwise ₹30,000. For a let-out house all the interest is deducted from the rent, but the overall loss you can set off is limited.
- Can I claim home loan interest in the new regime?
- Not for a house you live in. For a let-out house, interest is still deducted from the rent, but a resulting loss cannot be set off against your salary or other income.
- How does the principal deduction work?
- Principal repaid counts towards the ₹1,50,000 limit of Schedule XV, which replaced section 80C, together with EPF, PPF, life insurance, ELSS and tuition fees. If those already use the limit, the principal adds nothing. This deduction is only in the old regime.
- What happens to a let-out loss above ₹2 lakh?
- Under the old regime up to ₹2,00,000 of house property loss can be set off against other income in the year. The rest is carried forward for up to eight years and can only be set off against house property income.
- What about interest paid before the house was finished?
- Interest paid before construction was completed is deducted in five equal parts, starting in the year the house is completed. For a house you live in, those parts count within the ₹2 lakh limit. Add this year's share to the interest you enter.