Tax Query

This query is : Resolved

Hiru Patel (Querist)
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18 July 2011 Hello:

I had bought a property of 4 lacs in March 2006, in joint name with my wife. I had taken the home loan, in joint name and I paid installments from my salary account and availed Interest & Principal payment benefit in my IT returns. We sold it in June 2010 for 8 lacs.

We bought another property in July 2010 for 13 Lacs, in joint name and took loan of 11.9 Lacs, in joint name (including cost of stamp duty, registration, transfer fees) and currently instalments are being paid from my salary account and I am availing interest & principal payment benefit in my IT returns. No installments are being paid by my wife.

My queries:
1. What and how will be my & my wife's tax liability towards sale of property in FY 2010-11?
2. Currently the second property is rented. I plan to consider full rent income as income for my wife in her IT returns. Is it correct to do so? Meaning, can I consider full rent income as my wife's income while I am paying the installments towards it?

Please advice.

Thanks,
Hiru Patel

U S Sharma

U S Sharma (Expert)
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18 July 2011 if the HP income is accounted in your wife's hand then she is only eligible to repay the loan installments,

better to account the HP income in your hands as you are the payee.

in this case your interest claim will be any amount and not locked to 1.5 lacs,

Hiru Patel

Hiru Patel (Querist)
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18 July 2011 Thanks. Is there any option so that I can pay instalments of loan and rent income can be considered as my wife's income ?