Tax treatment - 2 properties jointly owned by self & spouse

I guess that you & your wife are the co-owners as well for both the flats and not just co-applicants.  If both of you are the co-applicants then only the owner of the flat can claim the tax benefit on home loan. Becuase from your text it appears that you are co-applicants and not co-owners. If yes you both are co-owners then only you both can claim the tax benefit on both the houses as per the mutually agreed ration between you too.

It is upto you two to dedice whihc flat shud be shown as SOP and DLO.  It woould be better to show that flat as DLo on whihc the interst component is higher, so that each one you can claim the loss on house property provided that the loss exceeds 1.50lacs for both of you.

Agree with Giridhar. You can show one flat as self-occupied and one as deemed let out and claim deduction.

Originally posted by : Mihir
	Agree with Giridhar. You can show one flat as self-occupied and one as deemed let out and claim deduction.

Originally posted by : Giridhar S Karandikar
	It is upto you two to dedice whihc flat shud be shown as SOP and DLO.  It woould be better to show that flat as DLo on whihc the interst component is higher, so that each one you can claim the loss on house property provided that the loss exceeds 1.50lacs for both of you.

Thanks Giridhar

Just to clarify, we both are co-owners in both the flats. However, in Flat A, I am the Primary applicant (First name in agreement) and in Flat B, my wife is the primary applicant.....On the cost of repeatition, would like to confirm following points - 

1. In case of 2 properties held jointly by 2 owners, can both claim ownership of 2 properties and show Flat A as SOP and other one as DLO

2. If the flats are joined from inside and used for residencial purposes, still can one flat be claimed as SOP and other one as DLO - Argument against this can be tenancy in DLO not possible since property is joined

3. How will ALV (Or fair value of rent calculated) - I got the possesion of both the flats in July 2012, but shifted only in Nov 2012 as renovation and repair work was going on. So how many months should i consider for calculating Rent and Municipal Tax

4. If i also borrowed money from Parents and paid Interest to them for the flat shown as DLO, can i claim tax benefit on that interest as well. Parents will obviously show the amount as income in their return

There is no restriction on size of SOP. While builder designed it as two apartment, for you it is one residential unit. Lot of parents design their house in a way that it could be split equally in two for their two children. In my view this is one residential unit and whole unit is SOP.

once both the flats are internally joined and only one kitchen is operating the same can be considered as one unit. accordingly the same can be considered as SOP only.

 

1.yes you can do that. reduce the same by way of agreement between both of you and notarize it so that if dept does any scrutiny you can produce the same.
2.you can claim as SOP but then point 1 of your question is N.A.
3. July to Nov
4.yes you can claim interest benefit and get a certificate from them. parents will need to pay tax. however you will not get benefit of principal paid since loan is not taken from notified financial institution