House loan benefit

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 May 2014 A HOUSE LOAN IS TAKEN ON THE NAME OF WIFE
MY QUESTION IS THAT,
WHETHER HUSBAND CAN AVAIL THE BENEFIT OF INTEREST & PRINCIPLE AMOUNT IF HIS WIFE IS NOT CLAIMING ANY DEDUCTION ?

Sandeep Dharar

Sandeep Dharar (Expert)
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02 May 2014 Yes if wife is not claiming any deduction then Husband can take, but only if payment is made by him.

Querist : Anonymous

Querist : Anonymous (Querist)

03 May 2014 what if the payment is made by his wife

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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28 July 2024 If a house loan is taken in the name of the wife, the general rule for claiming deductions on the loan interest and principal repayment under the Income Tax Act is as follows:

### **1. Eligibility for Deductions:**

#### **Interest on Home Loan (Section 24(b)):**

- **Eligibility:**
- The deduction for interest on home loan up to ₹2 lakh per annum under Section 24(b) can only be claimed by the person who is legally liable to repay the loan and is also the owner of the property.

- **Condition:**
- If the house loan is taken in the wife's name and the property is also in her name, she is eligible to claim the interest deduction. The husband, being neither the borrower nor the owner, is generally not eligible to claim this deduction, even if the repayment is made by him or his wife.

#### **Principal Repayment (Section 80C):**

- **Eligibility:**
- A deduction up to ₹1.5 lakh per annum for principal repayment under Section 80C is available to the person who is repaying the loan and is the owner of the property.

- **Condition:**
- Similarly, if the house loan is taken in the wife’s name and the property is in her name, the principal repayment deduction should be claimed by her. The husband cannot claim this deduction unless he is also a co-owner and a co-borrower.

### **2. Claiming Deductions if the Wife Does Not Claim:**

- **If the Wife is Not Claiming:**
- Even if the wife does not claim the deduction, the husband cannot claim it unless he is also a co-owner or co-borrower of the property. The right to claim deductions is tied to the ownership and borrowing responsibility.

### **3. Payment Made by the Husband:**

- **Payment by the Husband:**
- The person making the payment does not influence the eligibility to claim the deduction. Deductions are linked to who is legally responsible for the loan and who is the owner of the property, not who makes the payments. If the wife is the only borrower and owner, the deductions must be claimed by her.

### **4. Practical Steps and Recommendations:**

- **Joint Ownership:**
- If both spouses want to avail tax benefits, the loan should ideally be taken jointly, and the property should be in joint names. This allows both spouses to claim deductions in proportion to their share in the loan.

- **Documenting Payments:**
- Payments made by the husband should be documented and evidenced, but this alone does not provide eligibility for deductions if the loan and property are in the wife’s name.

- **Consult a Tax Professional:**
- For specific advice tailored to personal circumstances and to ensure compliance with the Income Tax Act, consulting a tax professional or chartered accountant is recommended.

### **Conclusion:**

To summarize, in the scenario where the house loan is taken solely in the wife’s name and the property is also in her name, the husband cannot claim deductions for interest or principal repayment. The eligibility for deductions is strictly tied to the legal responsibility for the loan and ownership of the property.

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