Joint owners & Interest on home loan
This query is : Resolved
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06 July 2023
Dear Sir / Madam,
It is seen in most flat purchase agreements that a person who is earning, keeps their spouse, mother, or father as a joint owner. They are there for the namesake and just to avoid any legal intricacy if something happens to the earning member. Their share is also not defined in the agreement.
Moreover, the housing loan is repaid by the earning co-owner only. The other co-owner doesn't contribute to the repayment also.
But still, in agreement, we have to show them as co-owner and their share, say as 50:50.
My questions are as follows:
1) If that property is rented for say Rs. 500,000/- pa and there is interest on home loan of Rs. 250,000/- then we have to divide the rent between the co-owners.
But the only earning co-owner is repaying the loan, can we show the entire interest on the Home loan of Rs. 250,000/- in his return and Rs. 0 in the other's return?
2) If the answer to 1 is yes and the other co-owner income is only rental income and some savings interest and total income is below the taxable limit. Will it be okay if he doesn't file the return, even though he has a share in the property?
Kindly guide.
Regards,
Suraj
It is seen in most flat purchase agreements that a person who is earning, keeps their spouse, mother, or father as a joint owner. They are there for the namesake and just to avoid any legal intricacy if something happens to the earning member. Their share is also not defined in the agreement.
Moreover, the housing loan is repaid by the earning co-owner only. The other co-owner doesn't contribute to the repayment also.
But still, in agreement, we have to show them as co-owner and their share, say as 50:50.
My questions are as follows:
1) If that property is rented for say Rs. 500,000/- pa and there is interest on home loan of Rs. 250,000/- then we have to divide the rent between the co-owners.
But the only earning co-owner is repaying the loan, can we show the entire interest on the Home loan of Rs. 250,000/- in his return and Rs. 0 in the other's return?
2) If the answer to 1 is yes and the other co-owner income is only rental income and some savings interest and total income is below the taxable limit. Will it be okay if he doesn't file the return, even though he has a share in the property?
Kindly guide.
Regards,
Suraj
06 July 2023
1. Yes, if the lender bank certifies the repayment in single owner's favor.
2. Not mandatory, but advisable if there is any such reporting in his/her AIS.
2. Not mandatory, but advisable if there is any such reporting in his/her AIS.
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06 July 2023
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