Tax benefits on Loans, Deposits & Interest

A. Loans 

Here is a list of loans (in nutshell) on the different tax benefits & savings it can offer.

A.1 House / Home Loan

Points to ponder - House Loan

A.2 Educational Loan

A.3 Personal Loan - for purchase or construction of House Property

A.4 Personal Loan - other purposes

A.5 Automobile Loan

A.6 Electric Vehicle Loan

In case the above deduction is claimed, same interest cannot be claimed elsewhere.

A.7 Gold Loan

B. Deposits & Interest received 

1.Amount invested under the Tax Savings fixed deposit schemes which has a lock in period of  5 years and deposits under Senior citizens savings scheme can be claimed under Chapter VI, Section 80 C along with other prescribed items.

2.On maturity, principal amount is not taxable.

Interest on deposits 

1.Interest received on Fixed deposits to be shown under the head Income from other sources & is fully taxable

2.Interest received on Savings deposits to be shown under the head Income from other sources. An amount of INR 10,000 can be claimed as allowable deduction u/s 80 TTA

3.Interest amount upto INR 50,000 is allowed as deduction for senior citizens under Section 80 TTB

4.Both Section 80 TTA & 80 TTB cannot be claimed together by a senior citizen

5.Deduction u/s 80 TTA is applicable on interest from

  i) Banks savings account

  ii) savings account with a co-operative society carrying on the business of banking

  iii) Post office savings account

Comparison - Section 80 TTB & Section 80 TTB