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Section 24(b) Home Loan Tax Benefit Calculator

Tax

Calculate income tax saved on home loan interest under Section 24(b). Enter your interest paid and income to see your annual tax saving instantly.

Reviewed by the thecalcu.com team · Last updated 23 July 2026

🇮🇳This tool is specific to India

three lakh fifty thousand rupees

₹0₹20,00,000

twelve lakh rupees

₹0₹2,00,00,000
₹0₹5,00,000

Annual Tax Saving

₹60,000
Deduction Claimed
₹2.00 L
Effective EMI After Tax Benefit
₹0
Lifetime Tax Saving (20 yrs)
₹12.00 L

This calculator computes your Annual Tax Saving, Deduction Claimed, Effective EMI After Tax Benefit, Lifetime Tax Saving (20 yrs) from the values you enter.

Inputs
Annual Interest Paid on Home LoanYour Annual IncomeTax RegimeMonthly EMI (optional)
Outputs
Annual Tax SavingDeduction ClaimedEffective EMI After Tax BenefitLifetime Tax Saving (20 yrs)

What is a Section 24(b) Tax Benefit?

The Section 24(b) Home Loan Tax Benefit Calculator estimates how much income tax you save each year by deducting the interest paid on a home loan. Section 24(b) of the Income Tax Act allows a deduction of up to ₹2,00,000 per financial year on home loan interest for a self-occupied property, one of the biggest tax breaks available to Indian homeowners, and one that's frequently underused simply because people don't run the numbers.

The deduction only applies to interest, not principal, and only under the old tax regime. That combination trips people up: a borrower paying ₹4,00,000 in annual interest might assume they're saving tax on the full amount, when in reality only ₹2,00,000 is eligible, and none of it counts if they've switched to the new regime. This calculator handles both constraints automatically, so the number you see reflects what you'd actually save, not a theoretical maximum.

It works alongside the Home Loan EMI Calculator, once you know your EMI and annual interest outgo, this tool converts that into a real tax figure, and shows what your loan effectively costs after the government's share is subtracted.

Why Use a Section 24(b) Tax Benefit Calculator?

Most EMI calculators stop at the monthly payment. They don't tell you that a chunk of that payment comes back to you at tax time, which means the "real" cost of a home loan is usually lower than the sticker EMI suggests. Skipping this step can lead to two mistakes: assuming a loan is unaffordable when the after-tax cost is actually manageable, or comparing rent versus EMI without adjusting for the tax refund on the loan side.

Say you're paying ₹45,000 a month in EMI with ₹3,80,000 of that going to interest annually. Capped at ₹2,00,000 and taxed at a 20% slab, that's a ₹40,000 annual saving, about ₹3,333 off your effective monthly cost. Over a 20-year loan that adds up fast, and it's the kind of number that changes whether renting or buying looks smarter on paper.

Who Should Use This Calculator?

First-time home buyers evaluating whether a home loan fits their budget need the after-tax EMI, not just the raw one, to judge affordability honestly. Existing borrowers filing ITR can use it to double-check how much they should be claiming under Section 24(b) before they file. Salaried employees deciding between tax regimes get a concrete number to weigh against the simplicity of the new regime, the Income Tax Calculator can then confirm the full-return impact. Property investors with a let-out home loan get a starting point too, though they'll want to model the uncapped interest deduction separately. Anyone comparing renting versus buying should run this before the Rent vs Buy Calculator, since the tax benefit materially shifts that comparison in buying's favour.

What Insights Does the Section 24(b) Calculator Give You?

Annual Tax Saving is the headline number, the rupee amount you save on your tax bill this financial year because of the interest deduction. It's ₹0 automatically if you've selected the new regime.

Deduction Claimed shows the actual amount of interest being deducted, which is either your full annual interest or the ₹2,00,000 cap, whichever is lower. If this number is capped, you'll see it's meaningfully less than what you entered, a sign you're not getting tax relief on every rupee of interest you pay.

Effective EMI After Tax Benefit takes your entered EMI and subtracts the monthly-equivalent of your tax saving, giving a rough sense of what the loan is really costing you month to month once the tax system's contribution is factored in.

Lifetime Tax Saving (20 yrs) projects the annual saving across a typical 20-year loan tenure, assuming your interest and income stay roughly stable. It's a ballpark, useful for seeing the deduction's cumulative weight rather than an exact 20-year forecast.

How to use this Section 24(b) Tax Benefit calculator

  1. Enter your Annual Interest Paid on Home Loan, check your bank's provisional interest certificate for the exact figure, or use your EMI schedule.
  2. Enter your Annual Income so the calculator can apply the correct marginal tax slab rate.
  3. Select your Tax Regime, choose Old Regime to see the deduction applied, or New Regime to confirm it's unavailable.
  4. Optionally enter your Monthly EMI if you want to see the effective, tax-adjusted EMI alongside the raw one.
  5. Review the Annual Tax Saving figure at the top, then check Deduction Claimed to see whether you've hit the ₹2,00,000 cap.
  6. Use the Effective EMI and Lifetime Tax Saving figures to compare the true cost of the loan against rent or against a different regime choice.
Show formula & methodology ↓Show less ↑

Formula & Methodology

Deduction claimed:

Deduction = min(Annual Interest Paid, ₹2,00,000)

Tax saving:

Annual Tax Saving = Deduction × Marginal Tax Rate

The marginal rate is read from the old-regime slabs applicable to the entered annual income (0% up to ₹2,50,000, 5% up to ₹5,00,000, 20% up to ₹10,00,000, 30% above that).

Effective EMI:

Effective EMI = Monthly EMI − (Annual Tax Saving ÷ 12)

Worked example: A borrower with ₹3,50,000 annual interest, ₹12,00,000 annual income (20% slab), and a ₹32,000 monthly EMI:

- Deduction claimed = min(₹3,50,000, ₹2,00,000) = ₹2,00,000
- Annual tax saving = ₹2,00,000 × 20% = ₹40,000
- Effective EMI = ₹32,000 − (₹40,000 ÷ 12) = ₹32,000 − ₹3,333 ≈ ₹28,667
- Lifetime tax saving (20 years) = ₹40,000 × 20 = ₹8,00,000

Frequently Asked Questions

What is Section 24(b) of the Income Tax Act?
Section 24(b) lets a homeowner deduct the interest paid on a home loan from their taxable income, up to ₹2,00,000 per financial year for a self-occupied property. It applies only to interest, the principal repayment is covered separately under Section 80C. This is one of the largest tax breaks available to salaried and self-employed borrowers in India.
Is the Section 24(b) deduction available under both tax regimes?
No. The deduction is available only under the old tax regime. If you've opted for the new regime, Section 24(b) doesn't apply to your self-occupied property, and this calculator will show ₹0 tax saving for that scenario.
What is the maximum deduction I can claim under Section 24(b)?
For a self-occupied property, the cap is ₹2,00,000 per financial year. If your annual interest exceeds that, the excess simply isn't deductible, it doesn't carry forward for self-occupied homes the way it can for a let-out property.
How is my tax saving actually calculated?
The eligible interest deduction (capped at ₹2 lakh) is subtracted from your taxable income, and the saving is that deduction multiplied by your marginal income tax slab rate. Someone in the 30% slab saves more per rupee of interest than someone in the 20% slab, even with identical loan terms.
Does this calculator account for Section 80C principal repayment too?
Not this one, it's focused purely on the Section 24(b) interest deduction. Principal repayment falls under the broader ₹1,50,000 Section 80C limit shared with EPF, PPF, ELSS, and life insurance premiums, so it needs to be evaluated against your other 80C claims separately.
What's the difference between a self-occupied and let-out property under Section 24(b)?
Self-occupied property has the ₹2,00,000 interest cap used in this calculator. A let-out (rented) property has no cap on the interest deduction, though the resulting loss can only be set off against other income up to ₹2,00,000 per year, with the balance carried forward for eight years.
How do I use this calculator with my actual loan details?
Enter the total interest you've paid or expect to pay in the financial year, your gross annual income, and select your tax regime. If you know your EMI, add it too, the calculator will show what your monthly payment effectively costs you after the tax saving is factored in.
Why does my effective EMI look lower than my actual EMI?
The effective EMI spreads your annual tax saving evenly across 12 months and subtracts it from your actual EMI, giving a rough sense of the loan's true monthly cost. You still pay the full EMI to your bank each month, the tax saving arrives later, as a lower tax bill or larger refund at filing time.
Can I claim Section 24(b) if I haven't taken possession of the property yet?
Interest paid during construction (pre-construction interest) is deductible too, but not in the year you pay it. It's totalled up and claimed in five equal instalments starting the year construction is completed, on top of the regular ₹2,00,000 annual cap.
Should I switch to the old regime just for this deduction?
It depends on your full tax picture, not just Section 24(b). Run your numbers through the [Income Tax Calculator](/in/income-tax-calculator/) under both regimes, if your combined 80C and 24(b) deductions are large enough, the old regime often comes out ahead for homeowners with an active loan.
Where does this fit into planning a home purchase?
It's usually the third calculation buyers run, after figuring out affordability and EMI. Once you know your [Home Loan EMI](/in/home-loan-emi-calculator/), this calculator shows how much of that cost the tax system effectively refunds, which then feeds into a fair [Rent vs Buy](/rent-vs-buy-calculator/) comparison.

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Also known as
24b calculatorhome loan tax benefit calculatorhome loan interest deduction calculatorsection 24b calculatorhousing loan tax saving calculator