Joint House Property-pls pls Reply

it will be 33.33% only

It is very advantageous to buy a property in joint name as each individual has the right to claim tax benefits. So if a property is owned by husband and wife together then both are entitles to claim deductions individually.
There is no rule as to the number of co-owners or who the co-owner is (brother, spouse or parents).

Following are the points to consider:

• The house should be bought in the joint name and care should be taken to keep the proof of co-ownership.

• The housing loan should be taken in joint names.

Repayment
The repayment of the loan should be done individually or from their joint bank account. The funds in the account should be contributed by the co-owners in proportion to their ownership/loan. Co-owners should have their independent sources of income from which the loans are re-paid.

Tax benefits are available in proportion to the joint ownership and the loan taken by the co-owners.

but on various site i have read that we can make a home sharing agremnet, detailing the ownership proprtion in a stamp paper, as legal proof for ownership between coonwer and accrodigly we can calim the dedcution.

Dear Harsh,

If the ratios of Joint owners are not definate then there is a chance of that property being asseed as AOP as a separate assessee..

If it is assed as AOP then there is no doubt that 100% will be allowed...

If it is not assessed as AOP, then one needs to think what would be done, I personally feel that Entire amount paid by u will be allowed as deduction subject to the limits of Rs. 1.50k/30k....

I couldn't find any circular, etc specifically on this subject, but there is something from where inferences can be drawn that u/s 80C - Investment there is a circular which says that in case of Investment made in Joint Names, benefit will be given to the one who makes the payment..........

Now the bigger question whether it will be asses as AOP or not, no hard & fast rule to determine...Facts of each case will be looked into.........I would suggest you to make a supplement deed if it is possible & fix the share of Joint owners to avoid litigations........ 

Normally the ownership ratio is not described in registry and as in case of couple where both have separate income (mean both are independently assessed ) and purchased a flat/house in joint ownership.

On Various site suggested that  to just define the sharing/ownership and loan repayment proportion by agreement and according to that claim the deduction.

Ref below the abstract

In case both husband and wife are working or have separate sources of income can apply for a joint loan for purchase of a house. This way, the loan eligibility and amount also increase. Under the Income Tax Act, tax benefits are available on housing loans and the interest paid on them. In case of joint loans also all the co-borrowers can get tax benefits.
Co-borrowers, who are also co-owners, are eligible for tax rebate in the proportion of their share in the loan. The repayment capacity of each spouse should be taken into account while deciding on the shares of the loan. The shares may be any ratio. The tax benefits would be shared in that proportion only. One should specify the share of the property and other loan details on a stamp paper.

It needs to be ensured that both should be co-owners of the property. The ownership of the co-owners of the house must be co-borrowers as well. It is essential for co-borrowers to be co-owners in order to claim the tax benefits. One cannot get tax benefits if he is just a co-borrower but not a co-owner.

In case a borrower pays Rs 1 lakh as interest and Rs 25,000 as principal, in case each has an equal share in the borrowing, each can claim Rs 50,000 against interest and Rs 12,500 against principal in their respective income tax returns. Each borrower needs a copy of the borrower certificate.

The borrowers should take the interest and principal certificate from the bank and each can submit copies of the certificates along with a copy of the agreement signed between them to claim tax relief.
The co-borrowers should enter into a simple agreement with the spouse on a Rs 100 stamp paper. This agreement should basically contain the share of the ownership along with that of the home loan availed by the couple.

If one of the co-owners does not have any income, then the other co-owner should enter into an agreement with the spouse. The agreement should state that the entire repayment is met only by one borrower's income. This would ensure that the main applicant will have 100 percent beneficial home ownership and consequently he can enjoy all tax benefits applicable to a single borrower.

The repayment of the loan may be repaid from a joint bank account, where both the husband and wife share the funds. Another option, although less popular, would be to share out the EMIs between husband and wife and both pay a specified number of cheques for the loan repayment.

It would need to be ensured that the repayment of the loan is made in the same ratio as the joint borrowing. Further, each of the borrowers should have a demonstrable source of income to justify the repayment of loan.

The maximum tax deduction allowed for a single borrower is Rs 1.5 lakhs. This deduction would apply to each borrower. A proper record of the respective shares of borrowings needs to be maintained to prove the shares of each of the borrowers.

 

According to that the same principle we can apply in our case of co ownership between self, father and brother. by agreement.