Your queries an­swered

Hindustan Times (Chandigarh) - Estates - - FRONT PAGE - Harsh Roongta Harsh Roongta is a per­sonal fi­nance ex­pert and in­vest­ment ad­vi­sor. He can be con­tacted on HT@harshroongta.com

I have taken a home loan with my wife as the main ap­pli­cant and I am the co-ap­pli­cant. I have reg­is­tered the apart­ment un­der my name. The bank has re­leased 80% of the loan amount to the builder. I came to know that since the property is not reg­is­tered un­der her name, she can­not claim tax ben­e­fits. What should I do to make her the co-owner with 50% share in the flat? Do I need to go for re-reg­is­tra­tion? Reg­is­tra­tion had cost me ` 1.5 lakh. I have read about trans­fer deeds, gift deeds, will deeds etc. Will gift­ing 50% property to my wife solve the prob­lem or do I need to sell 50% of the property to her? - Sa­gar Me­hta

You will need your lender’s ap­proval if you wish to gift 50% of the property to your wife, or re-reg­is­ter the property in her name to en­able her to avail tax de­duc­tion ben­e­fits. The ap­proval should not pose a prob­lem, as she is a co-ap­pli­cant to the home loan.

Whether you gift or sell a part of the property, it will have stamp duty im­pli­ca­tions though the stamp duty on a gift will be lower. In any case, if you gift the property it will not serve any ben­e­fit un­der the IT Act as the in­come from the as­set gifted to the spouse will be clubbed with your in­come.

I want a loan to buy land for my house. The land has still not been con­verted to res­i­den­tial use and is ac­tu­ally agri­cul­tural land. It is lo­cated within 5 km from the city.

– Samiul Is­lam No lender will be able to pro­vide you a loan to pur­chase an agri­cul­tural plot even though you even­tu­ally want to use it to con­struct a house. If you still want to buy the plot, you can con­sider tak­ing an un­se­cured per­sonal loan which will be fairly ex­pen­sive. It is avail­able at an in­ter­est rate of 13% to 22% per an­num de­pend­ing on the kind of em­ployer you work for and your credit pro­file. Also un­se­cured loans are avail­able for much shorter pe­riod such as five years and hence your EMI bur­den will be quite high. An­other op­tion could be to take a loan against tan­gi­ble move­able se­cu­rity such as shares, mu­tual fund units, sur­ren­der value of your life in­sur­ance pol­icy, na­tional sav­ings cer­tifi­cates, etc. Th­ese are much cheaper and are avail­able at an in­ter­est rate of 11% to 12% per an­num.

What are the tax im­pli­ca­tions if a per­son buys a house with a loan and sells it within three years and if he de­cides to sell it af­ter three years? Fur­ther, what is the im­pact on ben­e­fits re­lated to in­ter­est and cap­i­tal re­pay­ment? – Saloni Gupta

If you sell a house within a pe­riod of three years from the date of tak­ing pos­ses­sion, the dif­fer­ence be­tween the cost price and the net price shall be treated as short-term cap­i­tal gains and will be in­cluded in your other in­come and taxed ac­cord­ingly.

But, if the sale takes place af­ter three years, the profit will be treated as long term cap­i­tal gains and will be taxed at 20% af­ter in­dex­a­tion.

You can also save taxes on such long term cap­i­tal gains by in­vest­ing the cap­i­tal gains in an­other house property or bonds.

In case you sell the house bought against a loan within a pe­riod of five years from the end of the fi­nan­cial year in which pos­ses­sion of the property was taken and you had claimed the tax ben­e­fits un­der sec­tion 80 C in re­spect of prin­ci­pal por­tion of loan, all the de­duc­tions al­lowed in re­spect of the prin­ci­pal por­tion of such loan will be treated as in­come of the year in which this house is sold.

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