HOme Loan Exemption u/s 24

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  1. anurag1413suj

    anurag1413suj New Member

    I have a flat which is co-owned by my mother. Also i have a house loan for this flat in which my mother is co-applicant. The loan was taken in april 2010 and flat was handed over on aug2013. Till date my mother has not paid any emi. Also the flat is rented out.
    Kindly clarify if i can claim for exemption on interest paid against house loan on complete amount as emi is paid by me or i can take exemption of 50% amount only as the flat is co-owned. Also pls clarify if the tax liability of rent is also to borne by me or will it be shared by my mother.
    my mother and i are salaried person but in different income tax slabs.
     
  2. Raunak Gupta

    Raunak Gupta New Member

    Hi,

    In case of co-owners of a House Property, the rental income will be shared according to the share of ownership. Therefore 50% of the rent will shown in your personal return and balance 50% on your mother's return of income( as per sec 26 of IT).

    And, the total Interest payable on loan can be claimed by you u/s 24 and need not be shared by your mother. Also, the interest payable can be claimed on an accrual basis. (Note that the Intt. on loan payable during the period which is before the deed of purchase will be termed as pre-purchase interest and it can be claimed in 5 years in equal installments).

    Hope the matter is solved now.
     
  3. anurag1413suj

    anurag1413suj New Member

    How come liability in form of "rent" can be divided among the two and the benefit can be taken one only.
     
  4. Raunak Gupta

    Raunak Gupta New Member

    Hi,
    Here, when a property is co-owned, then the rental income will also be divided according to the share of ownership(as supported by section 26 of Income Tax Act,1961)....For eg, if the Total Rent is Rs800000 p.a. and you have paid rs 180000 as interest on borrowed capital for the property, then your income will be computed as follows:-
    Total Annual Rent : Rs800000
    Assessee's share of Rent : Rs400000 (50% of 800000)
    Less: Flat 30% deduction u/s24 : Rs 120000
    Less: Interest on borrowed capital: Rs 180000
    Net Income from House Property : Rs 100000/-
    Interest can be claimed fully be the person paying the interest, what is basically divided is the Rental Income and the House Tax paid on them...
     
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