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I have taken a housing loan from a public sector bank jointly with my husband for purchase of a flat in our joint names. Both my husband and I are salaried employees and income-tax payers.

We have started the repayment of the housing loan without utilising the moratorium period, starting from the subsequent month of the disbursement of the loan.

Are both of us eligible for claiming the deduction for the amount paid by us, proportionately, towards the principal repayment of housing loan during the period of construction of the flat, under Section 80C, for calculation of income-tax?

T. R. Manisha, Chennai

Both of you can claim deduction under Section 80C in respect of the principal amount repaid by you respectively out of your respective income and not proportionately. I take it that you have purchased a ready-to-occupy house.

Of course in no case shall the deduction for each one of you exceed Rs 1 lakh, including your contribution to recognised provident fund, etc.

In other words, there is a ceiling of Rs 1 lakh per person for making the specified investments.

S. MURLIDHARAN

More Stories on : Income Tax | Housing Finance | For the Asking

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