Regarding tds

Dear Sir,

TDS should be deducted in the ratio of ownership in property.

What is the ratio of ownership in Property?

Hello,

Both buyers husband-wife need to deduct TDS according to the amount being paid by them for the property and remit the same to the government through TDS form 26QB.

Since you have paid the booking amount, you only need to deduct the TDS on the booking amount paid. TDS on the rest of the amount will be deducted by the person paying such amount.

I hope this answer satisfies your requirement.

Regards,

CA Hunny Badlani

It can be paid by anyone.

- The purpose of filing Form 26QB is to check tax evasion. 

Yes, home loan repayment benefits will be available to both, just make sure both husband-wife are co-owners as well as co-borrowers.

Can't you make the ownership of the property also in 80:20 ratio? its always better to have ownership in the ration of funding to avoid issues in TDS and capital gain at the time of sale.

Yes, it can be claimed in the payment ratio.

There are two components of a home loan-principal and interest. Principal repayment qualifies for tax deduction under section 80C of the Income-tax Act, 1961, which has an overall limit of Rs1.5 lakh. Each co-borrower can claim this benefit to the tune of Rs1.5 lakh, but the combined claim cannot increase the total principal repaid during the year.

Interest payment qualifies for deduction under section 24(B), which has an overall limit of Rs2 lakh. Again, all co-borrowers can claim tax deduction for the same from their respective incomes, but the total claim cannot exceed the actual interest paid.

Besides these two tax deductions available to all homeowners, irrespective of whether they are first-time buyers or own more than one property, there is additional deduction available to firsttime homebuyer. This benefit is of up to Rs50,000 under section 80EE of the Act (read more about this here: http:// bit.ly/2Bx4idh).

Eligibility criteria for co-borrower
First of all, a co-borrower should also be a co-owner of the house for which the home loan was taken. Just being a co-borrower and paying the home loan EMI without being a co-owner will not make you eligible to claim home loan deductions. A co-borrower can claim tax deduction based on property rights or her share in the property. For instance, A and B bought a property taking a joint home loan, and the property rights are in the ratio of 60:40, respectively. The amount of total home loan principal and interest paid during the year should be claimed in the same ratio-60:40.

It is advisable to maintain a joint bank account to pay back the home loan, in which each co-borrower contributes respective share of the EMI. This will also help in maintaining records of payment and help in tax filing.

- Generally, property share is determined by the amount of investment by each co-owner. 

Hi,

You can claim the principal and interest amount in the ratio of 80.20 and according to me it would be correct also. However, you may receive queries from tax department and then you will have to explain it to them. 

Yes as per section 24 it says one would get deduction of interest paid therefore if you are paying 80% of loan you can claim 80% deduction even if the share is 50% each.

You can pay total TDS amount for now but remember that in the end both of you deduct 50% TDS each i.e. 30,000 each.

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Thank you