Benefits of buying a home in the wife’s name


With several states in India offering benefits for women property buyers to boost their empowerment, we examine why it makes financial sense to register a property in a woman’s name

There are several benefits to buying a property in a woman’s name, either as the sole owner or as a joint owner, with governments and banks offering several sops.

“Aspiring home buyers can seek certain benefits including tax exemptions if a home is bought in a woman’s name. Such offers can also attract more women buyers to the realty sector,” points out Ashok Mohanani, CMD, Ekta World. Encouraging women to register assets in their name, also boosts women’s empowerment, he adds.

Tax benefits of buying a home in the wife’s name

Experts explain that some of the obvious tax benefits of buying a home in the wife’s name, include an extra deduction of interest up to Rs 1.5 lakh every financial year, if the house is self-occupied. It is also applicable if the house is vacant. If a husband and wife are the joint owners of a property and if the wife has a separate source of income, then, they can both claim tax deductions individually. The tax benefit will depend on the ownership share of each co-owner.

Furthermore, if the property purchased is rented out, then, the wife can claim the total interest payable towards a home loan as deduction.

See also: 4 Advantages of Married Couples Jointly Owning Property

 

Discount on stamp duty charges for women

Several state governments in north India are now offering a partial waiver on stamp duty, for buyers registering properties in a woman’s name – either as a sole owner or as a joint owner.

“You can save 1%-2% on stamp duty, if the property is in a lady’s name. In Delhi, the stamp duty rate is 4% for women, compared to 6% for men. Moreover, if you are undergoing some financial setback and have some debts to repay, the property held in your wife’s name, does not come under the cover for your loss,” points out Sushil Raheja, CEO of Raheja Homes Builders & Developers.

Delhi, UP, Punjab, Haryana and Rajasthan, offer relaxations in stamp duty for women buyers. Punjab reduced the stamp duty charges from 9% to 6% in 2017, for a limited period. It maintained that from April 1, 2019, urban areas would again invoke a stamp duty charge of 9% and the same would be 6% in rural areas.

The stamp duty rate in Maharashtra, which was recently increased to 6% from the previous 5%, is uniform for both, men and women.

Stamp duty charges for Women Vs Men

StateFor menFor women
Jharkhand4%4%
Delhi6%4%
Haryana5% in rural

7% in urban

3% in rural

5% in urban

UP7%Rebate of Rs 10,000 on overall charges
Rajasthan6%5%
Punjab7%5%
Maharashtra5%-6%4%-5%
Tamil Nadu7%7%
West Bengal5% in rural

6% in urban

(Plus 1% if property cost is >Rs 40 lakhs)

Same
Karnataka2% to 5%Same

Note: List is not exhaustive – charges are indicative and subject to change.

 

Discount on home loan interest rates for women

Additionally, many banks such as SBI, HDFC, ICICI, etc., offer discounts on home loan interest rates to women as compared to men. This varies from bank to bank and goes up to nearly one per cent.

The prevailing interest rates for women borrowers are as mentioned below:

Home loan interest rate (floating) – Women borrowers Vs Others

BankInterest rate for women borrowers (per cent, per annum)Interest rate for others (per cent, per annum)
SBI6.65-7.05 (w.e.f May 1, 2021)6.80-7.15
ICICI Bank6.70-7.95 (w.e.f March 2021)6.75-7.95
HDFC Ltd6.75- 7.80 (w.e.f March 4, 2021)6.80-7.40
PNB6.80-7.406.80-7.40

Note: The rates are applicable on loan amount < Rs one crore

 

Things to keep in mind when buying a home in the wife’s name

Experts maintain that it is a good idea to buy a home in the name of one’s wife or in co-ownership. However, the wife can enjoy the tax benefit, only if she has a separate and genuine source of income. Moreover, if there is any legal dispute on the property, then both, the husband and wife, will be involved in the case. Therefore, home buyers should evaluate all possibilities, before making a final decision.

 

The flip-side

In case of a divorce, the property will be divided according to the share of the wife as mentioned in the sale deed. This would happen irrespective of whether or not the wife has made any monetary contribution in the purchase or loan repayment.

 

FAQs

Can I buy property in my wife name?

Yes, you can buy property on your wife’s name as there is a number of tax benefits and exemptions available for registering property in woman’s name which includes stamp duty discounts etc.

Can I take home loan on my wife name?

Many banks such as SBI, HDFC, ICICI, etc., offer discounts on home loan interest rates to women as compared to men. This varies from bank to bank and goes up to nearly one per cent. The wife can enjoy the tax benefit, only if she has a separate and genuine source of income.

Can husband claim ownership of property bought in wife's name?

Yes, husband can claim ownership of property bought in wife’s name provided the funds used for buying the property is from known sources and legal.

Can spouse be on title but not loan?

If a house is purchased in the wife’s name, it is important to opt for a home loan in her name or a joint home loan. Property owners who are not loan borrowers and do not have any contribution towards the EMI, will not be eligible for tax benefits

 

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