Tax Saving
Querist :
Anonymous
(Querist) 07 December 2009
This query is : Resolved
I bought a house & Taken home loan on my name. I availed tax benefit on it. Now, my re-payment against loan amount is going to complete. After this I will not be able to avail tax benifit on it & have to pay tax on HRA given by the company.
My query is
Whether I can transfer my home in the name of my wife & take a RENT RECEIPT from her in order to save my INCOME TAX.
2. IF I BUY A SECOND FLAT AND AGAIN TAKE HOME LOAN, CAN I AVAIL THE TAX BENEFIT ON IT ?
Vineet
(Expert) 07 December 2009
If you gift flat to your wife and take rent receipts from her, you will be able to save some tax.
First of all please note that by virtue of clubbing provisions of income tax act, the income earned by your wife from this gifted house shall be clubbed to your income and accordingly taxed.
However you will save some tax as by paying your HRA to her as rent the HRA becomes exempt in your hand (subject to fulfilment of all conditions). Now, in your wife's hand this is rental receipt, so she will be entitled for deduction of 30% of rent for repairs and maintenance and also any municipal tax being paid. The balance amount is taxable income from house proprty which shall be clubbed in your hand.
However, evaluate this saving agaist the stamp duty payable on gift deed and registration charges. In Maharashtra stamp duty of 2% plus registration charges of 1% shall be leviable on gift deed which is a substantial amount.
If you buy another house by taking another loan, you will definitely get deduction for interest on loan, but mind it, you will have to pay tax on rental income from this property irrespective of the fact that the second property is let out or not.
Raj Kumar Makkad
(Expert) 07 December 2009
repeated quarry. You quarry has very weel been answered by various experts on today itself in the same section
