I purchased a shop property in my wife\’s name by taking a joint loan. Most of the fund was provided by me, and the loan was also repaid by me i.e. no contribution from his wife. My query is, how to show the rental income from this shop in the my return? Should I show it directly in the schedule HP (house property). Or should I first calculate the income in my wife\’s hand and then show in schedule SPI (income from spouse clubbed)? I am confused between section 27 and clubbing provisions under section 64.
To claim the tax benefits, you must be the owner or co-owner of the property. The rental income should be considered in her name. She has to show in her IT returns and file the tax.
But here in your case, the property is owned by her. Hence, rental income can be claimed by her only.
I think this property will fall under gift to spouse, and hence clubbing provision will apply. Please confirm if that’s not the case.
I know your doubt about GIFTING. However, whether you shown the same amount of payment (EMI and lump sum payout) while buying a property in her name in your IT return? Whether you created a deed of gift?
If now, then how can you claim earlier payments as proof of gift?