Question ID : 40824

Joint Home Loan

A house is owned by Mrs. X. A home loan has been taken on said property by Mr. and Mrs. X (Co-borrowers). The EMI of the said loan has been paid from Mr. X Bank account. Who is eligible to claim deduction for Principal and Interest under Income Tax? If none of them are eligible, what is the general practice adopted by the professionals and in whose return deduction is claimed?

None of them can claim deduction as payment of EMI is made by co-borrower, who is not co-owner. The general principle is that the person claiming deduction must be co-borrower and co-owner of the property. He can claim deduction of principal and interest on loan in the proportion of ownership or in the proportion of contribution of EMI.