Maximum additional tax 'saving' with home loan

[Himanshu Agrawal]

I want to confirm my following understanding:

Context:

• Person is a private sector employee, so it means he gets HRA.
• Person falls in 30% tax bracket
• Person takes a home loan of 29 lakh and value of the property is 40 lakh
• Person will not live in that property, he will either rent it or his parents will live
• Person is already utilizing his 80C exemption This is means person can only apply for a maximum of 2.5 lakh of exemption

Questions:

• With the above-stated conditions, am I correct that the maximum exemption he can apply for is 2.5L?
• Considering the 30% bracket and availing an additional 2.5L exemption against the home loan, am I correct that the maximum additional saving for him will be 75,000?
• Does it matter whether the person lives in that home or rent it out? Does it impact tax calculation?
• Any other key consideration I am missing related to tax calculations?

If any tax expert could help clarify/confirm my understanding, it will be greatly appreciated.

Warm Regards

AI Summary

Employee Seeks Confirmation on Home Loan Tax Savings and Impact of Renting vs. Occupying Property Under Section 80C A private sector employee in the 30% tax bracket seeks confirmation on tax savings related to a home loan. The individual has taken a home loan of 29 lakh for a property valued at 40 lakh, which will not be used as a primary residence. They are already utilizing the 80C exemption, allowing for a maximum additional exemption of 2.5 lakh. They inquire if the maximum additional tax saving would be 75,000 and whether living in or renting out the property affects tax calculations. They seek expert advice on any other tax considerations they might have missed.