Interest on loan taken for house
This query is : Resolved
01 April 2012
This is case of individual (salaried employee)
Have bought a new residential premise (in March 2012) registered in the name of his spouse, Possession has been in April 1, 2012 . He has taken a home loan for the same but in his own name. Interest being more than 1.5 lacs p.a. can the deduction be still be claimed? What would be the consequences of claiming the deduction of 1.5 lac p.a.
Already having an unoccupied bungalow (having higher market value than newly purchased). What would be the wealth tax impact..?
One house can be shown as self occupied and can the new one been shown at value less loan i.e. no tax?
Further can the new house can be shown as given on rent for claiming entire interest on loan (around 6 lacs annual). Then how the property under wealth tax should be shown?
thanks & regards
Have bought a new residential premise (in March 2012) registered in the name of his spouse, Possession has been in April 1, 2012 . He has taken a home loan for the same but in his own name. Interest being more than 1.5 lacs p.a. can the deduction be still be claimed? What would be the consequences of claiming the deduction of 1.5 lac p.a.
Already having an unoccupied bungalow (having higher market value than newly purchased). What would be the wealth tax impact..?
One house can be shown as self occupied and can the new one been shown at value less loan i.e. no tax?
Further can the new house can be shown as given on rent for claiming entire interest on loan (around 6 lacs annual). Then how the property under wealth tax should be shown?
thanks & regards
CA Ghanshyam Joshi
(Expert)
02 April 2012
Hello Mr. A,
I do not know the impact of loan taken in the name of assessee but the property is in the name of wife.
But for wealth tax my comments are as follows -
1. If the newly purchased house is registered in the name of spouse but all payments for purchase were made by the assessee then it will be a deemed asset and will be clubed for wealth tax in the assesses hands.
2. If loan has been taken against the newly purchased house then the loan liability can be deductiable from that asset only, not from the old house.
3. If the new house is a residential house and let out for more than 300 days in a year then it will be exempt from the def of Asset i.e. not taxable - loan liability can be claimed against that or any other house as the original asset is exempt.
From income tax point of view - deemed income in the hands of assessee - full interest can be claimed as deduction from the rental income.
I do not know the impact of loan taken in the name of assessee but the property is in the name of wife.
But for wealth tax my comments are as follows -
1. If the newly purchased house is registered in the name of spouse but all payments for purchase were made by the assessee then it will be a deemed asset and will be clubed for wealth tax in the assesses hands.
2. If loan has been taken against the newly purchased house then the loan liability can be deductiable from that asset only, not from the old house.
3. If the new house is a residential house and let out for more than 300 days in a year then it will be exempt from the def of Asset i.e. not taxable - loan liability can be claimed against that or any other house as the original asset is exempt.
From income tax point of view - deemed income in the hands of assessee - full interest can be claimed as deduction from the rental income.
CA Ghanshyam Joshi
(Expert)
02 April 2012
for wealth tax -
One house property can be claimed exempt on the choice of the assessee - old house will be claimed as exempt under this as new house will be exempt asset (let out for more than 300 days).
Please also take professional opinion from practicle tax planning angle.
One house property can be claimed exempt on the choice of the assessee - old house will be claimed as exempt under this as new house will be exempt asset (let out for more than 300 days).
Please also take professional opinion from practicle tax planning angle.
04 April 2012
Can the interest on loan be claimed (entire) agaisnt salary income as well.. or only the rent received ? Can it be still claimed where the house is in the name of spouse but the payment is being made by husband who has taken the loan..! pl replt.. thanks and regards
CA Ghanshyam Joshi
(Expert)
04 April 2012
Loss under the head House property due to Interest on Housing Loan can be setoff against all the heads of income including Salary.
Regarding your other query "Can it be still claimed where the house is in the name of spouse but the payment is being made by Husband who has taken the loan!" please take the advice of any good practicing consultant... therotically this is not defined in law.
Regarding your other query "Can it be still claimed where the house is in the name of spouse but the payment is being made by Husband who has taken the loan!" please take the advice of any good practicing consultant... therotically this is not defined in law.
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