Reduce Your Taxes With a Second House
Homi Mistry, Partner at Deloitte Haskins & Sells, says that a person can get tax benefits on the interest payable on more than one home loan. He adds, "Whether the second house is purchased purely as an investment option or as a weekend getaway, the interest paid on a loan taken to buy it is tax-deductible. Since the interest payment is a large expense, you can add significantly to your disposable income if you can save on it."
If the second house is still being constructed, 20 percent of the total interest payable during the period of pre-construction is exempted from tax. This exemption limit is given to home owners for a period of 5 years from the time the house gets constructed till you get ownership of it.
