How to become a joint owner for mortgaged property

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Before we discuss tax benefits of a joint home loan, it's important to understand conditions which must be met -
1. You must be a co-owner - To be able to claim tax benefits for a home loan, you must be an owner in the property. Many a times, a loan is taken jointly, but the borrower is not an owner as per the property documents. In such a case you may not be able to claim tax benefits.
2. You must be a co-borrower - Besides being an owner, you must also be an applicant as per the loan documents. Owners who are not borrowers and do not contribute to the EMI shall be devoid of the tax benefits.
3.The construction of the property must be complete - Tax benefits on a house property can only be claimed starting the financial year in which construction of the property is complete. Tax benefits are not available for an under construction property. However, any expenses prior to completion are claimed in five equal instalments starting the year in which construction is complete.

Adding another owner (as co-owner) to your property can be done through..

Sale Deed : You can include your name in the new sale deed mentioning the ratio or portion of the ownership and get it registered. The stamp duty is typically in the range of 5-12.5% of the market value of the property (varies in different states), while the registration charge is about 1%.

Gift Deed : You can also share the ownership by gifting it to someone. In this case, you will need to get a gift deed executed on a stamp paper and register it at the registrar’s office. A gift to a relative is not taxable. However, if you gift the property to a non-relative, the value of the house is treated as income and taxed according to the income tax rules for the relevant year. The stamp duty is generally 2% of the value of the property, along with 1% registration charge.

Advocate Siddhant Sharma LawRato