Can I claim home loan interest in the new tax regime?

For a self-occupied house, no - the Rs 2 lakh interest deduction isn't available in the new regime. For a rented-out house, interest is still deductible against rent, but a resulting loss can't offset salary. Self-occupied: Section 24(b) interest deduction NOT available in the new regime Let-out: interest still deductible against rent; resulting loss can't be set off against salary/other income 80C, 80EE, 80EEA are unavailable in the new regime regardless Salaried taxpayers can pick the old regime each year; those with business income use Form 10-IEA

Should I switch to old regime for my home loan?

For a self-occupied house, no - the Rs 2 lakh interest deduction isn't available in the new regime. For a rented-out house, interest is still deductible against rent, but a resulting loss can't offset salary. Self-occupied: Section 24(b) interest deduction NOT available in the new regime Let-out: interest still deductible against rent; resulting loss can't be set off against salary/other income 80C, 80EE, 80EEA are unavailable in the new regime regardless Salaried taxpayers can pick the old regime each year; those with business income use Form 10-IEA

CAPGAIN › Answers › Capital gains & TDS on property › Is Home Loan Interest Deductible Under the New Tax Regime?

Is Home Loan Interest Deductible Under the New Tax Regime?

Short answer: For a self-occupied house, no - the Rs 2 lakh interest deduction isn't available in the new regime. For a rented-out house, interest is still deductible against rent, but a resulting loss can't offset salary.

Law: Section 115BAC, Income-tax Act 1961 · Authority: CBDT · Status: in force · Checked 25 Sept 2026

What you need to know

Self-occupied: Section 24(b) interest deduction NOT available in the new regime
Let-out: interest still deductible against rent; resulting loss can't be set off against salary/other income
80C, 80EE, 80EEA are unavailable in the new regime regardless
Salaried taxpayers can pick the old regime each year; those with business income use Form 10-IEA

Who this applies to: homeowners, landlords with a home loan, CAs

Official / primary source: incometaxindia.gov.in (government source)

The law behind it

New Tax Regime vs Old Tax Regime - Impact on House Property Income

The new regime (now default) has lower slabs but strips most property deductions. Self-occupied home loan interest is lost entirely; let-out interest is still deductible but any loss can only offset other house-property income, not salary.

Section 115BAC, Income-tax Act 1961 · in force · source

Form 10-IEA - opting for the old tax regime (to claim house-property loss set-off)

Since the new tax regime became the default, a taxpayer with business/professional income who wants to stay on the old regime - typically to fully use deductions like home-loan interest set-off against other income, or Section 80C/80D benefits on a self-occupied or let-out property - must file Form 10-IEA before the ITR due date. Salaried taxpayers can choose the regime each year directly in the ITR without this form; only those with business/professional income need it.

Form 10-IEA · in force · source

Work out your own numbers

CAPGAIN's free calculators cover capital gains (12.5% and 20%-indexed side by side), TDS on property, stamp duty and registration by state, home-loan EMI and prepayment.

Open the CAPGAIN calculators