Husband (H) and wife (W) purchased a house jointly in 50:50 ratio. Afterwards, they gave it on rent and the made rent agreement in the name of W. Whole rent is credited in the bank a/c of W only. Will the whole rent income be taxed in the hands of W only??
4 Replies
Karan Teli
(Life Is just an Illusion...!!)
(4573 Points)
Replied 27 December 2012
No, as per the rental agreement the same shall be charged in proportions to the contractual agreements.
It shall be taxed in both H and W hands and the concept of application and diversion of income is to be referred.
Saurabh Maheshwari
(B.com,ACA)
(5923 Points)
Replied 27 December 2012
Basis of charge of House Property Income-
Annual Value of a building or land attached thereto is taxable as HP income in the hands of a person who is the owner or a deemed owner of the House property
In your case both Husband abd wife are owner(jointly) so the HP income i.e rent will be proportinately taxed in the income of Husband and Wife.The contents of agreement is immaterial in this case.
CA Sourabh Goenka
(Chartered Accountant)
(249 Points)
Replied 27 December 2012
@ Abhilasha : Please read section 26 of Income tax act, saying about Property owned by co-owners.
You will definately get your answer..
Kulwant Singh Khalsa
(CA STUDENT)
(105 Points)
Replied 28 December 2012
Agree with all
But you need to check clubbing provision too and Section 27.
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