Are you planning to take a home loan? You can save a lot of tax by taking a joint loan with your wife

It is important to understand many things before taking a home loan. Home loan is a responsibility that will remain on you for many years. A house bought with a home loan can be helpful in your wealth creation. A house also gives you financial security. Home loan also helps you in tax-savings. If you take this loan together with your life partner (wife/husband), then you will be able to do more tax-savings. This also opens the way to take more loans.

One or more persons can take a home loan together. Generally, husband and wife take a home loan together. There are many benefits of this.

Higher home loan amount: Taking a joint home loan with your life partner opens the way to getting a bigger loan. This is because the bank or NBFC decides the maximum loan amount based on the income of both the husband and wife. By taking a higher home loan, you can buy a bigger house.

Financial responsibility on both: In a joint home loan, both the husband and wife contribute to the EMI. This puts the responsibility of repaying the loan on both. This also maintains financial discipline.

More tax-savings: Both husband and wife can claim deduction on home loan. This doubles the tax benefits.

Additional benefits to women borrowers: Many banks offer 0.05-0.10% discount on interest rates if the primary borrower is a woman. In some states, stamp duty exemption is also given if the house is registered in the name of a woman. This reduces the total purchase cost of the property.

Tax benefits under section 80C and 24B

If the home loan is taken jointly, then both husband and wife can claim separate tax deductions.

-Each co-borrower can claim a deduction of Rs 1.5 lakh on payment of principal amount.

-This deduction is available on both self-occupied and rented properties.

– Deduction on interest amount is available only if the loan is taken from a recognized financial institution.

-If the property is being used for personal residence, then both co-borrowers can claim deduction of up to Rs 2 lakh on interest payment.

-If the house is given on rent, there is no limit on the amount to claim deduction on interest. However, the loss under the head 'Income from house property' can be set off against other income up to a maximum of Rs 2 lakh per financial year.

In this way, if both husband and wife claim deduction separately, a total deduction of up to Rs 7 lakh (Rs 1.5 lakh plus Rs 2 lakh for each individual) can be claimed in a financial year.