Hi Sir, My father sold a property(land) and wish to purchase a new apartment(flat) in my name. My query here is, 1.do my father has to transfer funds in to my account and may have to give to the builder from my account. or 2.My father can give funds directly to the builder without comes to my account. Please help me here.
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Your father should purchase property in joint names to avail benfit of long term capital gains
2) There is no tax to be paid on the gains, if your father use the entire gain from the transaction to buy another house within two years or construct another house within three years.
3) if funds are transferred in your account by your father he would not be able to save any tax on long term capital gains
Your father may buy this property on your name, whereas the sale consideration may flow from his account itself. Thus, follow option 2.
1. If the proeprty is purchased in your name by your father then transfer of fund to your account is not essential.However if you have other siblings then to avoid future disputes from them you can opt for this transfer of fund, else not.
2.Otherwise there is no legal requirement to pay directly to the builder by your father and get the proeprty registered in your name.
Dear friend,
1. Due to recent demonitization and strict financial rules, it is better your father pay the amount through cheque to the developers directly, it is easy for him to claim tax rebate in his tax returns.
2. Let the house purchased in your name.
3. Get gift deed in your name to justify the transaction. More suggestions in person, if you are free then please visit my office Malleswaram, Bengaaluru.
Upon considering tax perspective as well,
1. Section 54 of the Income Tax Act entitles a person to tax exemption on profit earned if that entire profit amount is used to buy another house. The seller can buy a new house within 2 years from the date of sale of his previous property or construct a new house within 3 years from the date of sale.
2. Both of your above points could get you legal problems in future.
3. I suggest you that your father buy the property on his name and get the Registered gift deed on your name.
4. If your father buy the property on your name by using his income then you may need to provide your income details to buy the property and you would liable to pay tax for the same.
You may discuss with me for more information.
Hello,
While doing any such transaction the tax scenarios shall also be kept in mind. Therefore, I would advise your father the purchase the property on his name and then transfer the same to you by means of a gift deed, or alternatively you can purchase the property on your joint name also.
if the funds are transferred to your account then the father might not avail the benefit of LTCG.
Regards
1. The sale was made by your father, hence in order to avail the benefit of long term capital gain your father should purchase the property in himself and your joint names.
2. The seller has to buy a new house within 2 years from the date of sale or construct a new house within 3 years from the date of sale in order avail long term capital gain.
Dear Client,
There`s no problem to buy property in ur name by ur father. Mode of payment is not an issue until made from known source of income.
Your father can very well fund for the purchase of property to your name without any problem.
The funding can be directly from his account to the seller or he can even deposit the amount to your account as gift and you can buy the immovable property from that source.
Both are valid in law.
Both ways are acceptable
