• Tax benefits on multiple home loans vary by self-use, rental, and tax regime.

• Interest deduction for self-occupied homes capped at Rs 2 lakh under old regime

• Section 80C principal repayment benefits apply only under the old tax regime

Here is break down of the tax benefits applicable to multiple home loans, based on self-use, rental and tax regime under both old and new tax regimes.

Here is an example !

A home loan taken in 2011 to purchase a flat, which has now been fully repaid. Now planning to take another home loan for a different flat. Whether eligible for tax benefits on this new loan? The explanation is that

• Tax laws do not cap the number of home loans for which you can claim deductions, whether at the same time or after repaying an earlier loan. For a second home, tax benefits depend on self-use or rental and the tax regime chosen.

• If the second house is let out, you can claim a 30 percent standard deduction on rental income, and the entire home loan interest is deductible under the old tax regime.

• If it is self-occupied, the interest deduction is capped at Rs 2 lakh for both properties combined, as only two self-occupied houses are permitted. Any house property loss can be set off against other income up to Rs 2 lakh in a year, with the balance carried forward for eight years.

• Under the new tax regime, no interest deduction is allowed for a self-occupied property. If the property is let out, interest can be claimed only up to the taxable rental income (limited to 70 percent of rent) as losses under the house property head cannot be set off against other income.

• For all home loans combined, principal repayment qualifies for deduction under Section 80C, subject to the overall limit of Rs 1.5 lakh along with other eligible investments, only if you opt for the old tax regime, as Section 80C benefits are not available under the new regime.