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Treatment of interest paid towards housing loan

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SREELAKSHMI

OFFICE EXECUTIVE

23 Points Posted on 12 December 2016

Hi,

We have property at bengaluru. Property is in the name of Mrs. X My husband has taken loan by mortgaging the documents of the property said above to construct office space for his use(in first floor). Mrs. X is one of the applicant in the loan. Loan is repayed from my husband. My husband is runnig a proprietoryship business. Can he claim interest repaid as an expense. Please note that property is not in his name. If property has to be in his name to claim the interest as expense, what is the document/agreement to be made between owner and repayer of loan.

Replies (6)

CA Neha Agrawal

830 Points Posted on 12 December 2016

How can one get loan when property is not in his name. How can he mortgage the property without being it's owner

Mohan

Audit Assisstant & Accounts Manager

489 Points Posted on 13 December 2016

Surprising but it has happened in one of my client's case too. Property is in his wife's name and he obtained loan for purchase of the property in hi name.

Mohan

Audit Assisstant & Accounts Manager

489 Points Posted on 13 December 2016

I mean loan was obtained in his name.

SREELAKSHMI

OFFICE EXECUTIVE

23 Points Posted on 13 December 2016

Dear Madam,

Inour case Mrs. X is also one of the applicant in the loan.

CA Neha Agrawal

830 Points Posted on 13 December 2016

Loan is being used for construction of office space, this will be fixed asset for business on completion. Interest expense on such loan can be claimed as business expense.