Many of us might not aware of the maximum benefits which can be available through home loans. You might be planning to buy your first house by taking a home loan.  One might be looking to buy a buy home loan for the self-occupied property. There are 3 ways where an individual can get income tax benefit from home loans. What are the income tax benefits for buying a home through home loans for first time u/s 24 of income tax act? What is the tax benefit for buying a home through home loans u/s 80C and u/s 80EE? What are the maximum income tax benefits available under these sections 80C, 24 and 80EE?
What are Home Loans?
You can skip this section if you are aware of a home loan.
Home Loan is the financial assistance given by the bank or financial institution to an individual to buy property. The title or deed of the property is held back by the institution until the loan is repaid fully with interest.
The documents required for home loan varies from bank to bank. However, here is a list of common documents.
Identity proof – It includes aadhar card, passport, driving license, Pan Card or voter Id.
Address proof – It includes proof of your current residence in which you have to provide any utility bills.
Bank statement – Last 3 month or 6 months as required.
Salary statement – Last 3 months (for salaried people)
Income proof – It includes audited financials for the last 2 years (for self-employed)
What does Home Loan EMI contain? 
The home loan which is obtained from the bank is repayable in equated monthly installments (EMI). This installment includes two components- the principal amount and interest. EMI is an unequal combination of principal and interest components. In the initial stages, the repayment is more to interest amount than to principal amount. However, as the time passes and you reach towards the end of repayment tenure, more of principal is repaid.
If you have got a lump sum amount of money, you can make use it towards the part payment of the loan, this reduces your EMI or loan tenure.
3 Ways to get Maximum Income Tax Benefits from Home Loans u/s 80C, 24 and 80EE 
There are different treatments for the repayment of principal amount and the interest paid off the home loan. Tax benefit on repayment of the principal amount can be claimed under section 80C. Tax benefit on repayment of home loan interest is allowed u/s 24 as well as u/s 80EE of the Income Tax Act, 1961.

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1) Income tax benefits u/s 80C 
The amount paid as repayment of principal amount of home loan is allowed as a deduction under section 80C of the Income-tax Act, 1961 subject to the maximum limit of Rs 150,000. This tax benefit can be availed only once the construction of the house is completed. No deduction is allowed when the house is under construction period through this section. If you have not exhausted 80C through other tax saving investment options, home loan principal amount can be claimed as part of this section to avail tax benefits.
This benefit is available only when the loan is taken on or after 1st April, 1999 for the purchase or construction of the house but not for repairs or renovation. The acquisition or construction needs to be completed within 5 years from the end of the financial year in which the loan was taken.
If the house is self-occupied – As per section 24, the maximum amount of deduction that can be claimed towards the repayment of interest amount is Rs 200,000. The amount is claimed under the head “Loss from house property”.
If the house is NOT self-occupied due to job/business being in another city – There is also a possibility that the property is not self-occupied and the individual is staying at another place due to his employment or business, then, a fixed amount of Rs 200,000 shall be considered for deduction
Property is rented – In case the property is not self-occupied but rented, the rent received will be considered as Income and the Interest paid will be claimed under deduction. If the individual’s interest paid is more than rent then it can be set off as Loss from House Property and can be a deduction from the taxable income. There is no maximum limit to be claimed here.

How to treat pre-construction interest? 
In the case of EMI starting before pre-construction period, following guidelines would apply
1) Purchase/construction loan – Interest paid prior to construction period can be claimed as a deduction in 5 equal installments for next 5 financial years.
2) Reconstruction / Renovation Loan – No tax deduction would be available for the interest paid till the construction is completed.

3) Income tax benefits u/s 80EE 
In Budget 2016, this section introduced. The benefit u/s 80EE can be availed only by those individuals who are first time home buyers. The deduction allowed under this section is for interest paid on home loan up to a maximum of Rs 50,000 every financial year till the home loan is fully paid. One important point to note in this relevance is that the loan amount should not exceed Rs. 35 Lakhs and property value should not exceed Rs 50 Lakhs to avail this benefit. The home loan should have been sanctioned after 1st April, 2016 and before 31st March, 2017. This exemption is over and above the limit under sec 24. 

Summary of maximum income tax benefit for home loans
The maximum benefit that can be availed by an individual if they satisfy all the conditions is Rs 400,000.
1) One can avail maximum Rs 150,000 (towards the repayment of principal amount) u/s 80C if he has not claimed any other deduction under this section.
2) They can claim Rs 200,000 (towards repayment of interest amount) u/s 24

3) Further Rs 50,000 (towards repayment of interest amount for first time home buyers) u/s 80EE.