Joint home loan if wife not earning

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