80EE vs. 80EEA: What’s the Difference in Home Loan Tax Deductions?

Introduction

Sections 80EE and 80EEA of the Income Tax Act provide valuable tax deductions to first-time homebuyers by allowing them to reduce specific expenses from their taxable income. These benefits—ranging from ₹50,000 to ₹1,50,000—apply solely to the interest portion of home loan repayments.

The eligibility for these deductions depends on the date your home loan was sanctioned. The key distinction between the two sections is that Section 80EE offers deductions on home loans up to ₹35 lakh, while Section 80EEA extends this benefit to loans up to ₹45 lakh.

This article explains the differences between Sections 80EE and 80EEA in detail so you can make informed decisions and optimize your tax savings.

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What is Section 80EE?

Section 80EE of the Income Tax Act provides an additional tax deduction on home loan interest for first-time homebuyers. Individuals who have taken a home loan for a property valued up to ₹50 lakh with a loan amount not exceeding ₹35 lakh can claim benefits under this section.

This provision allows taxpayers to claim up to ₹50,000 per financial year on the interest component of their home loan. The deduction can be availed every year until the loan is fully repaid.

Who is Eligible for the Section 80EE Deduction?

To claim the deduction under Section 80EE, the following conditions must be met:

Individual Taxpayer: Only individuals are eligible. Entities such as HUFs, AOPs, companies, or trusts cannot claim this deduction.
First-Time Homebuyer: The applicant must be purchasing their first residential property and should not own any other house in their name or their spouse’s name.
Loan from a Financial Institution: The home must be purchased using a loan from a recognized financial institution or housing finance company.
Residential Property: The property must be a residential house, not commercial or industrial.

Note: The taxpayer does not need to reside in the property to claim the deduction. The benefit is available even if the property is rented out.

How to Claim a Tax Deduction Under Section 80EE

Follow these steps to claim the deduction:

Calculate the Interest Paid: Determine the total amount of home loan interest paid during the financial year.
Claim Under Section 24: First, claim the deduction of up to ₹2,00,000 under Section 24(b) for interest paid on a home loan.
Claim Under Section 80EE: If any interest remains unclaimed after using Section 24(b), you can claim an additional deduction of up to ₹50,000 under Section 80EE.

What is Section 80EEA?

Section 80EEA, introduced in the Union Budget 2019, offers enhanced tax benefits to first-time homebuyers in India. Under this provision, individuals can claim an additional deduction of up to ₹1.5 lakh on home loan interest for the purchase of a residential property.

This deduction is over and above the existing ₹2 lakh limit available under Section 24(b) and is also separate from deductions under Section 80C. Together, these benefits provide significant tax relief for eligible homeowners.

Who is Eligible for the Section 80EEA Deduction?

To qualify for a deduction under Section 80EEA, the taxpayer must meet the following conditions:

Individual Taxpayer: Only individuals can claim this deduction. HUFs, AOPs, companies, and trusts are not eligible.
Residential Property: The deduction applies only to residential properties, not commercial or industrial units.

How to Claim a Tax Deduction Under Section 80EEA

Follow these steps to claim your deduction:

1. Ensure You Meet the Eligibility Requirements

First-Time Homebuyer: You must not have owned any residential property in your own name or your spouse’s name before the loan was sanctioned.
Carpet Area Limits:
- Up to 60 sq. meters (645 sq. ft.) for properties in metropolitan cities such as Delhi NCR, Mumbai, Hyderabad, Bengaluru, Kolkata, and Chennai.
- Up to 90 sq. meters (968 sq. ft.) for properties in all other cities and towns.
Stamp Duty Value: The property’s stamp duty value must not exceed ₹45 lakh.
Loan Sanction Date: The home loan must have been sanctioned during FY 2019–20 or FY 2020–21.

2. Calculate Your Deduction

You can claim up to ₹1,50,000 as a deduction from your taxable income under Section 80EEA for the interest paid on your home loan.

Important Note

Deductions under Sections 80EE and 80EEA are not available under the new tax regime. To claim these benefits, you must opt for the old tax regime.

80EE vs 80EEA: Key Differences Between Section 80EE and Section 80EEA

The table below highlights the major differences between Section 80EE and Section 80EEA of the Income Tax Act:

Comparison of Sections 80EE and 80EEA

Feature	Section 80EE	Section 80EEA
Purpose	Offers a deduction on interest paid on a home loan.	Offers a deduction on home loan interest specifically for affordable housing.
Deduction Amount	Up to ₹50,000 per financial year.	Up to ₹1,50,000 per financial year.
Eligibility	First-time homebuyer who has not claimed deductions under Section 80EE or 80EEA earlier.	First-time homebuyer with no prior claims under Section 80EE or 80EEA, and the property must have a stamp duty value of ₹45 lakh or less.
Property Value Limit	No specific property value limit.	Property value must not exceed ₹45 lakh.
Loan Sanction Period	Applicable for home loans sanctioned in FY 2013–14, 2014–15, and 2015–16.	Applicable for home loans sanctioned in FY 2019–20 and 2020–21.

Can I Claim Both 80EE and 80EEA?

No, you cannot claim deductions under both Section 80EE and Section 80EEA at the same time. Eligibility for each section is tied to the year in which your home loan was sanctioned, and once you claim a deduction under one section, you become ineligible for the other.

However, you can claim a deduction under Section 24(b)—which allows up to ₹2,00,000 for home loan interest—along with either Section 80EE or Section 80EEA.

About the Author

Vinod

Vinod is an experienced legal writer who simplifies complex legal concepts into clear, practical insights. He helps entrepreneurs understand their legal responsibilities and build confident, compliant, and sustainable businesses.

February 1, 2026