Housing loan-interest deduction u/s 24 for joint loan

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Prashant (Querist)

10 February 2014 I am a salaried person and my wife is doctor having her own practice. We are planning to take home in the joint name and also we are planning to take loan on the joint name
The eligibility for loan is met on my income however from tax standpoint we are planning to take home loan on our joint name.
So I have following queries-
1)Can my wife be first borrower and can I be co-borrower. (My wife's income is not enough to get the requisite loan)
2)If I keep paying the EMI from my account still can my wife claim deduction of interest and principal from her taxable income, if yes, how to calculate the amount of interest and principal
3)Is it necessary that the first name and second name of property should be the same for loan purpose meaning that suppose my name is first name for property so is it necessary that for loan purposes my name should be first

CA Saranya

CA Saranya (Expert)

10 February 2014 Dear Mr.Prashant,

Basic rules about joint loan for IT purpose:

1.The property should be in both parties names
2. Loan should be in both their names
(first borrower or co-borrower doesnt matter here)
3. Ask your wife to transfer her share of EMI and you pay from your bank account. (Only loan amt repaid through means other that cash ll be considered for IT)
4. share of individual in Principal and Interest ll be based on the property document and Loan document.

Both can claim a deduction upto Rs.150000(each-individually) if the property is self occupied. If its let out no limitation in such deduction. Both can claim their share of Interest without any limit.

Other experts pls correct me if I'm wrong somewhere.

Thank you.

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