Tax benefits of buying an electric car

Updated: Jun 10

A new section 80EEB has been introduced allowing a deduction for interest paid on loan taken for the purchase of electric vehicles from the AY 2020-21.

Eligibility criteria

Only Individual who has taken a Loan for purchase of an Electrical Vehicle from any Financial Institution

Maximum Amount of deduction

The benefit of deduction under this section would be available from A.Y.2020-21 and subsequent assessment years till the repayment of loan continues. A deduction for interest payments up to Rs 1,50,000.

Why section was Introduced?

  • To promote Electrical Vehicles

  • To Reduces dependence on oil imports

  • To Reduces Carbon Emissions

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