Saurabh Aggarwal (Chartered Accountant) (371 Points)
25 June 2010If two people are co-owners of a house property and they have taken a loan for purchase of that house property what should be the treatment of the deduction avaliable u/s 24(b). Assume that all the formalities have been complied with in order to get deduction of 150000.
Kindly tell the treatment of same if:-
1. The share of co-owners is defined in the registry
2. The share of co-owners is not defined.
AJAY SIMHA
(CMA - final)
(190 Points)
Replied 25 June 2010
hi saurab,
If two people co-own a house property if there share defined and registered then they are taxable proportionately to their share of income from house property u/s 26.
calulate GAV & NAV as if it owned by a single owner and give deduciton u/s 24(b) as applicable and calculate total income under head "Income from House property" and proportionate the income as per their share.
but if share of co-owners are not defined and not registered it is taxable in hands of that co-owner whose income before adding such income from House property is higher.
reg
Ajay
ICWA-inter
DT Fundas - Tarun rustagi
( Author)
(1150 Points)
Replied 26 June 2010
dear saurabh
1.in case of definate share- each co ownner is entitled to get a deduction of rs.150000 but generally in practical life the actual interest is very low of that amount.but if yes then each co owner can cliam 150000 each.
2.in case of not definate share- they can get a maximum deduction of rs. 150000 in aggregrate.
regards
tarun rustagi
PRATEEK
(ACA)
(102 Points)
Replied 26 June 2010
IN CASE OF CO-OWNERSHIP THE RESPECTIVE PORTION OF EACH CO -OWNER IS SPECIFIED THEN THE INCOME FROM HOUSE PROPERTY WOULD BE CALCULATED ON THE BASIS OF THERE RESPECTIVE PORTION AND A MAXIMUM DEDUCTION OF Rs 150000 WOULD BE ALLOWED IN CASE OF SOP . BUT IF THE SHARE OF CO- OWNERS IS NOT SPECIFIED THEN IT WOULD BE TAXABLE AS AN ASSOCIATION OF PERSONS
manisha ahuja
(article clerk)
(147 Points)
Replied 26 June 2010
m still confused as regards to answer given by tarun
hw each f dem can claim 150000
if dat wud hv been d case den people will purchase 1 house keep deir share indetermined n claim 300000 mutually............
golden rule 1 house-max exemtion to be claimed= 150000
Mayank Jain
(service)
(31 Points)
Replied 26 June 2010
Dear Freinds,
In case of co-owners deduction under section 24(b) is given in proportionate of the amount of installments(emi) paid by each owner. However limit of Rs 150,000 is given to each individual seperately.
NARENDER PAWAR
(CA final Student)
(337 Points)
Replied 26 June 2010
in case of co-owner deduction u/s 24b is allowed rs. 150000. but if the share of co-owner is defined than deduction is allowed rs. 150000 to each co owner.
Ravi Prakash
(Service)
(38 Points)
Replied 26 June 2010
Dear collegue
deduction under section 24 (b) in case of coowner of property-------- Deduction is availiable to both coowner to the extent 150000/- seperately to each other.
Income tax act does not provide anywhere that deduction is limited to the extent of coowner; shares in the property, it provides only for the deduction of intrest taken for house property and this is availiable to the owner of the property. as there is coowner of house property they are entitled to deduction to the extent 150000/- each.
This is prevailed practice in the market to save income tax and thats why most of the Tax experts advice for taking house loan in joint name.
DT Fundas - Tarun rustagi
( Author)
(1150 Points)
Replied 26 June 2010
dear friend ( sealed....) i hope ur query is resolved by the other replies so i think there is no need for me to submit reply to ur query.u are just thinking about the amount of deduction and not thinking that AO will be able to know the details of ur one more property.80 % of the people does not disclosing their property to IT dept.there are also some other issue.
and as said by me usually the interest amount is very low of that amount.
the actual interest is divided among each co owner and each co owner is entitled to claim of deduction of rs.150000 individually.
regards
tarun rustagi
manisha ahuja
(article clerk)
(147 Points)
Replied 28 June 2010
suppose a n his father has taken home loan mutually
a purchases house in his own name
can his father claim interest deduction u/s 24(b)
Rishab
(A.C.A.)
(155 Points)
Replied 29 June 2010
No I don’t think the deduction u/s 24 (b) can be availed by father.
Deduction is available only if you have Income from that House property on which loan has been obtained (whether it is let out or self occupied-NIL Income). In absence of ownership of property how can you claim the deduction.
Suppose, You own a Car. How can your father claim depreciation on the car which is owned by you.
manisha ahuja
(article clerk)
(147 Points)
Replied 30 June 2010
xactly
dis is d answer i was xpecting
had read dis case in et
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