Quick answer: For a self-employed borrower, the ITR is the salary slip. LIC HFL asks for the last 3 years of income tax returns with financial statements and lends on the income you declare, so low declared income means a small loan. Proof that the business has run for 3 years, such as a GST certificate, Udyam (MSME) certificate or a shops and establishments (“labour”) licence, makes the file stronger. No ITRs at all? Look at Griha Sugam.
By Vijay Arjun V (B.Pharm, PGDM), authorised LIC HFL DSA since 2002 and DME (Direct Marketing Executive) appointed by LIC HFL. LIC HFL document requirements checked on lichousing.com on 29 October 2026.
Why your ITR decides your home loan
A salaried borrower proves income with salary slips and Form 16. A business owner or professional proves it with income tax returns. Lenders read your income from the ITR, the computation of income and the profit and loss account, not from your turnover or what you say you earn. Every rupee you leave out of your ITR to save tax is a rupee the lender can’t count.
What the declared profit does to your loan (no other EMIs; half the monthly income towards the EMI; LIC HFL’s self-employed rate from 7.55% over 20 years; our calculation):
| Profit declared in ITR (yearly) | Monthly income | EMI possible | Approximate loan |
|---|---|---|---|
| ₹3,00,000 | ₹25,000 | ₹12,500 | ₹15.8 lakh |
| ₹6,00,000 | ₹50,000 | ₹25,000 | ₹31.5 lakh |
| ₹9,00,000 | ₹75,000 | ₹37,500 | ₹47.3 lakh |
| ₹12,00,000 | ₹1,00,000 | ₹50,000 | ₹63 lakh |
Why lenders ask for 3 years
LIC HFL’s documents list for self-employed and professional borrowers asks for income tax returns for the last 3 years along with financial statements. Three years show that the business is stable and let the lender look at the trend: a steady or rising income supports a bigger loan than one good year after two weak ones.
Business proof that strengthens your file
| Document | What it proves | Where to get it |
|---|---|---|
| GST registration certificate and returns | The business exists at that address, and its turnover | GST portal (gst.gov.in) |
| Udyam (MSME) registration certificate | A registered micro, small or medium enterprise and its start date | udyamregistration.gov.in: free, online, based on Aadhaar and PAN |
| Shops and establishments registration (“labour licence”) | A registered shop or office and when it started | Telangana Labour Department |
| Trade licence | Permission to trade at the premises | GHMC or your municipality |
| Partnership deed or company incorporation certificate | The legal form of the business and your share | Your firm’s records or the MCA portal |
| Professional registration | Your right to practise (doctors, CAs, architects, lawyers) | Your professional council |
The dates on these documents are how a lender judges the age of your business, so register early and keep them current.
ITR mistakes that cut your loan
- Declaring too little income to save tax: the lender can count only what you declare.
- Filing late, or 2–3 years together just before applying: recent filings for old years invite questions.
- Figures that don’t match: ITR turnover far from GST returns or bank credits.
- A cash-heavy business with little of it passing through the bank account.
- No CA-prepared financials: a profit and loss account and balance sheet make your income credible.
- Business and personal money mixed in one account.
- Unpaid tax or mismatches in Form 26AS or the Annual Information Statement.
Startups and businesses under 3 years old
- Add a salaried co-applicant, such as a working spouse, whose income can carry the loan; see joint home loan with spouse.
- File every year, on time, from year one, with honest profit figures and CA-prepared financials.
- Register early: GST (when required), Udyam and shops and establishments, so the business age shows on paper.
- Run everything through a business bank account.
- Talk to us before the third ITR, so the timing of your application works for you.
No ITRs? Griha Sugam
LIC HFL’s Griha Sugam scheme is for small business owners, such as kirana, garment or hardware shop owners, who don’t file ITRs but earn enough for an EMI. It lends ₹5 lakh to ₹30 lakh on the strength of a proven 3-year business vintage instead of ITRs.
Frequently asked questions
Is ITR compulsory for a self-employed home loan?
For a regular LIC HFL home loan, yes: the last 3 years with financial statements. Griha Sugam is the option for small business owners without ITRs.
Can I file 3 years of ITR now and apply?
You can file belated or updated returns within the legal time limits, but lenders see the filing dates. Filing on time every year is far better. Ask your CA first.
Does GST registration help get a home loan?
Yes. It proves the business exists, and GST returns that match your ITR support your income.
Is Udyam registration free?
Yes. It is done online on the government’s Udyam portal, based on Aadhaar and PAN.
What is the rate for a self-employed home loan at LIC HFL?
From 7.55% (CIBIL 825+), with a term of up to 20 years. See LIC HFL home loan for self-employed.
More: documents required for a home loan · eligibility calculator · LIC HFL home loans in Hyderabad.
Sources: lichousing.com home loan page (documents for self-employed and professional applicants; self-employed rates), checked 29 October 2026; Udyam Registration portal (Ministry of MSME). Loan amounts are our calculations.
Hyderabad Home Loans is run by Elite Financial Services, an authorised Direct Selling Agent (DSA) of LIC Housing Finance Ltd. We are not LIC HFL. Loans are sanctioned solely at LIC HFL’s discretion; rates and fees may change.
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