Your housing finance queries answered by R.P. Deshpande, senior mortgage banking professional
I have applied for a home loan in my name and in my mother’s name as co-applicant. The flat will also be in our joint names but I will be paying all the EMIs. Will I get the full tax breaks, or will I get only partial tax benefit?
— Rajesh Nair, Tuticorin
If your mother is not claiming income tax deductions, you can claim tax deductions in full. You can create an agreement between you and your mother stating that you alone will be repaying the home loan. The income tax officials may seek a declaration from your mother confirming that she has not claimed tax deductions in her IT returns.
What is the advantage of a Registration Will over a Notary Will when it comes to taking probate for personal property in future?
— Rajarshi Kundu, Kolkata
A will executed on white paper and witnessed by two people is a valid document. However Notarising the Will makes the document more acceptable as it is executed before a Notary. Further if the Will is registered, the authenticity of the instrument gets further enhanced. While probating the Will, Courts may consider the Registered Will is more authenticated instrument as compared to a Notarized Will. If the Will is registered, there may be lesser verifications and fewer hearings, if the Will is contested by other parties during the course of probate proceedings.
I stay and work in Trichy, where I bought my own flat on a bank loan. I took tax benefits and I repaid the loan three years ago. Now, I plan to buy a second flat on another loan. Can I claim tax benefits for my second home loan?
— Kumar P., Trichy
Yes. You can claim tax deductions both on interest and principal on the home loan to be availed for acquiring your second house.
I live with my wife in our own flat in Adyar. We recently bought a small cottage near Uthandi as a weekend home. We don’t rent it out, but use it on weekends or holidays. Do we have a tax liability on the second home?
— Madhur Mohan, Bengaluru
Since you are not earning any income out of the second house, there is no income tax liability. However, you need to pay property taxes as applicable and you are liable to pay wealth tax,
if your net worth (Assets less Liabilities to acquire assets) is Rs. 30 lakh or more on 31 March of each year.Any one property of higher value is exempt from wealth tax. If you have availed loans to acquire such assets, the outstanding loan is deducted from the market value of the property to arrive at your net worth.
I took a home loan and bought a house in Ashok Nagar. I am still paying the EMIs. I live with my family on the ground floor, and I have given the first floor on rent to two bachelors. Can I claim the entire interest amount for deduction?
— Muthu Kumar S., Chennai
No. Since you are staying in the same premises, you can claim tax deduction up to Rs. 150,000 pa only on the interest paid on the home loan repayment.