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Interest on car loan deductiable??

Farhaad Jiwani (Tax Consultant at Nagpur) (303 Points)

07 April 2016

Car is purchased & ownership documents are in the name of my father (ie owned by him) but the loan which is taken for this car will be repaid from my account under ECS system.. I have a query regarding whether I can enjoy the interest deduction benefit from my PGBP income (Can I save my tax on it?)? who will enjoy the depreciation benefit between us? Thank you

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4 Replies

CA Raj Doshi (Practising CA) (8898 Points)
Replied 07 April 2016

If the loan is on your name , then you can claim to be the owner ( beneficial owner ) and accordingly take interest and depreciation benefit. Otherwise no benefit to you.

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Farhaad Jiwani (Tax Consultant at Nagpur) (303 Points)
Replied 07 April 2016

Thank you for the reply.... that simply means my father will be allowed to take the both deductions (depreciation + interest on car loan) from his income?? right??