Deductions regarding house property loan

This query is : Resolved

Sriram (Querist)
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19 August 2015 Dear members

Kindly give the solution..

For example both Husband & wife was salaried employee. Husband constructed a House property in his name. (Both Land & Building in Husband name only). They borrow loan from Bank for construction of above mentioned House in their joint name i.e. Husband & wife both names reflected in housing loan statement. Wife was repaying the loan from her SB (exclusively in wife name) Account. (Source: wife’s salary income).

Questions:
1. Wife can claim interest on housing loan benefit u/s 24?
2. Wife can enjoy the benefit of Principal repayment U/s 80C?
3. What are the possibilities of Income tax deductions in the hands of both Husband & wife?

Sriram

Sriram (Querist)
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24 August 2015 Hi anybody please answer to this questions very urgent....

Sriram

Sriram (Querist)
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24 August 2015 Hi anybody please answer to this question.. very urgent

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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20 July 2024 In the scenario described, where both the husband and wife are salaried employees and the house property is in the husband's name but the housing loan is in joint names (husband and wife), the tax deductions can be claimed as follows:

1. **Interest on Housing Loan (Section 24):**
- Yes, both husband and wife can claim the deduction for interest on housing loan under Section 24 of the Income Tax Act.
- The deduction allowed is up to Rs. 2 lakh per year for self-occupied property, provided the loan is taken for purchase or construction of the property and the construction is completed within 5 years from the end of the financial year in which the loan was taken.

2. **Principal Repayment (Section 80C):**
- Yes, both husband and wife can individually claim deduction for repayment of principal amount of the housing loan under Section 80C of the Income Tax Act.
- The maximum deduction allowed under Section 80C for principal repayment (including other eligible investments) is up to Rs. 1.5 lakh per financial year.

3. **Income Tax Deductions:**
- **Husband:**
- Can claim deduction under Section 24 for interest on housing loan.
- Can claim deduction under Section 80C for principal repayment of the housing loan.
- **Wife:**
- Can also claim deduction under Section 24 for interest on housing loan (if she is a co-borrower and is repaying the loan).
- Can claim deduction under Section 80C for principal repayment of the housing loan (if she is a co-borrower).

It's important to note:
- The ownership of the house property being in the husband's name does not restrict the wife from claiming deductions if she is a co-borrower and repays the loan.
- Both husband and wife can claim deductions up to their respective shares in the housing loan repayment and interest payment.
- The amount of deduction claimed under Section 24 and Section 80C cannot exceed the actual amount paid during the financial year.
- Proper documentation, such as loan statements and payment receipts, should be maintained to substantiate the claims.

In summary, both husband and wife can separately claim deductions for interest on housing loan under Section 24 and for principal repayment under Section 80C, provided they meet the conditions specified under the Income Tax Act.