For
any Personal loan, the interest paid is for the most part not deductible.
However if the loan is used in obtaining any income which you are unveiling in
your Return of Income and in a position to legitimately identify the loan with
gaining that income, then the interest and different expenses might be
guaranteed as a deduction. There is no
other method of benefiting from personal loan under the Indian Income tax law
of 1961 as changed till date.
Assuming that you have taken a personal loan from a bank, housing finance company, Life Insurance Corporation of India
or from an employer and used the cash for purchase or construction of a house,
you can assert IT profits for both principal and interest paid. But in the event that you have taken a loan
from a friend or relative, and then you can assert tax reductions on the
interest paid justly. In any case, provided that you have taken a loan for renovation
of your house building, then you can claim reasoning up to Rs.30, 000 a year of
the interest paid.
Normally
such Personal loans have to be arranged in such a manner, that some origin of income gets
tagged. Loans for particular utilization or family matters are not entitled to
Income tax concessions. Also loan for marriage, education, traveling and do
not get such concessions. Usually, a few organizations like ICICI, HDFC and LIC make loans for Housing and vehicle necessities. They also do not usually
provide loans for different purposes to salaried individuals since they can lay
their substantial hands effectively and rapidly in the event of default on
these possessions and recuperate their giving.
