Loan from family member for 2nd home

This query is : Resolved

krishna (Querist)
Follow

19 August 2018 I am buying my second home and wants to take loan from my mother instead of a bank. But i want to pay her monthly interest just like i have to pay the bank. In this scenario, can i claim the tax on rental income for the interest part that i pay to my mother on monthly basis ?
If yes, what kind of loan agreement need to be made with my mother ? I guess, necessary documents need to be produced while claiming the tax on rental income during IT returns

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

19 August 2018 Yes, have a loan agreement in a stamp paper value of 100. Receive the loan payment through bank account and pay interest through bank.

krishna

krishna (Querist)
Follow

19 August 2018 Thanks for your reply..
Should the loan agreement be notarized ?
what about promissory note ? is it not considered valid document in this scenario ?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

20 August 2018 Yes promissory note is enough no need of notorized.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok