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Joint home loan if wife not earning

08 February 2021

hi. can we take joint home loan in the name of myself and my wife. my wife is dependent on me. later can we both claim deductions for principal and interest in our ITR seperatly.
please suggest.
thank you

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5 Replies

CA. Sourav Sarkar (Chartered Accountant ) (24588 Points)
Replied 08 February 2021

Yes you can take joint home loan but deduction can be claimed by you because wife is dependent on you

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Modassir ISLAM (5 Points)
Replied 08 February 2021

Not available

CA.Pujah (Service) (1005 Points)
Replied 08 February 2021

To be able to claim the tax benefits on the property –

1) Both must be a co-owner in the property-

2)Both must be Co-borrower of the Loan.

If above conditions are satisfied:

1) For a self-occupied property – Each co-owner, who is also a co-applicant in the loan, can claim a maximum deduction Rs 2,00,000 for interest on the home loan in their Income Tax Return. The total interest paid on the loan is allocated to the owners in the ratio of their ownership.

2) For a rented property – The interest that can be claimed as a deduction in case of rented property is restricted to the amount to which loss from such house property does not exceed Rs 2 lakhs.

3) Each co-owner, can claim a deduction of maximum Rs 1,50,000 towards repayment of principal under Section 80C. This is within the overall limit of Rs 1,50,000 of Section 80C.

Therefore, as a family, you will be able to take a larger tax benefit against the interest paid on the home loan when the property is jointly owned and your interest outgo is more than Rs 2,00,000 per annum.

However, please note that such splitting is advisable if both are earning members, so that both can enjoy individual exemptions/ deductions and fall in lower tax brackets

Ashish Goel (13 Points)
Replied 08 February 2021

Thank you Pujah and Saurabh.. God bless. have agood day.

Kapadia Pravin (17264 Points)
Replied 08 February 2021

As you said wife is dependent on you, she doesn't have her own income. So where is the question of getting housing loan interest benefit benefit. You may keep her name as joint name in the property. That's all.