Rajnish Agrahari (26 Points)
17 March 2023
CA Rakesh Ishi
(Working at Private Company)
(8202 Points)
Replied 17 March 2023
Yes, the husband can claim a deduction on interest on the loan u/s 24(b) of the Income Tax Act, 1961, even though the property is in his wife's name. As per Section 26 of the Income Tax Act, if a property is owned jointly by two or more persons, the income from such property is taxed in the hands of each co-owner in proportion to their respective share in the property.
Similarly, in case of a joint loan, each co-borrower is entitled to claim deduction on interest paid on the loan, in proportion to their share in the loan. Therefore, the husband can claim a deduction on interest paid by him on the loan in the proportion of his share in the loan.
This view has been upheld by various courts, including the Income Tax Appellate Tribunal (ITAT) in the case of Prakash vs ITO (ITAT Delhi), where it was held that "The husband and wife can be co-borrowers in respect of a housing loan, and the interest paid on such a loan is eligible for deduction under section 24(b) of the Act in the hands of both husband and wife in proportion to their respective shares in the loan."
CA Rakesh Ishi
(Working at Private Company)
(8202 Points)
Replied 14 July 2023
"no deduction shall be made under the second proviso unless the assessee furnishes a certificate, from the person to whom any interest is payable on the capital borrowed, specifying the amount of interest payable by the assessee for the purpose of such acquisition or construction of the property, or, conversion of the whole or any part of the capital borrowed which remains to be repaid as a new loan."
Yes as per my understanding of this section 24b
Kuldeep Singh
(201 Points)
Replied 14 July 2023
@ Rakesh Ishi, but here is answer big NO
https://www.caclubindia.com/forum/claim-deduction-u-s-section-24-b-and-80c-both-on-same-home-loan-601073.asp
Note:
For claiming both these deductions you need to satisfy two basic conditions. Firstly, you should be owner of the house whether as sole owner or as joint owner. Secondly, you should be either a sole borrower or co-borrower and servicing the home loan.
CA Rakesh Ishi
(Working at Private Company)
(8202 Points)
Replied 14 July 2023
| Originally posted by : Rakesh Ishi | ||
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Yes, the husband can claim a deduction on interest on the loan u/s 24(b) of the Income Tax Act, 1961, even though the property is in his wife's name. As per Section 26 of the Income Tax Act, if a property is owned jointly by two or more persons, the income from such property is taxed in the hands of each co-owner in proportion to their respective share in the property. Similarly, in case of a joint loan, each co-borrower is entitled to claim deduction on interest paid on the loan, in proportion to their share in the loan. Therefore, the husband can claim a deduction on interest paid by him on the loan in the proportion of his share in the loan. This view has been upheld by various courts, including the Income Tax Appellate Tribunal (ITAT) in the case of Prakash vs ITO (ITAT Delhi), where it was held that "The husband and wife can be co-borrowers in respect of a housing loan, and the interest paid on such a loan is eligible for deduction under section 24(b) of the Act in the hands of both husband and wife in proportion to their respective shares in the loan." |
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Dear Kuldeep,
you are correct.
if a property is owned jointly by two or more persons, the income from such property is taxed in the hands of each co-owner in proportion to their respective share in the property.
PLEASE READ AGAIN
rittesh
(pratice)
(32 Points)
Replied 02 April 2024
If there are co-owners than what declaration to be given to the company regarding who is claiming the interest and principal. Say the Interest is 2 lacs then both the co-owners will claim benefit. So as a Company what should we do check the deduction has been rightly claimed.
Manish
(CA)
(1174 Points)
Replied 02 April 2024
In this case, husband will be treated as deemed owner according to section 27. Hence, the income will be assessable in his hands. And he can claim interest on loan also.
CAclubindia
