manish s (team lead) 22 April 2010

Query on home loan

Hi,
I have a query regarding income tax benefit on home loan.
I own a home at my natice place for which I had taken loan of 8 lakhs, in which after prepayment & EMI now remaining loan amount is approx 2.75 L which I would be paying as EMI for new 30 months.
As this home is in another city so I am taking home loan as well as HRA benefit currently.Now I am planning to buy a house in the city ,where I work.My wife is also a working woman. My query is to get the maximum benefit , without much loss, on whose name I should take my new home, as If I take house on my name then I wouldnot be able to claim my HRA. Is there a way that I take home on my wife's name and I still get the benefir of HRA and my existing home loan. Kindly suggest the best solution possible.Thanking you
Regards,
Manish Surjan

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Vineet (Director) 22 April 2010

If you have a choice purchase the new house in the name of your wife. As if you purchase new house in your name, one of the two houses owned by you will be trated as deemed let out and you would be required to pay tax on market rent of the same even if the same is not given on rent. As your wife is also working she will be able to take benefit of interest paid on home loan and principal repayment.

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