Stamp duty on gift deed and income tax on selling property
My mother has one immovable property in her name in Rajasthan & she does not have pan card.
I want to know the best way of using amount of selling that property.
1. should my mother gift it to me & pay stamp duty on it. then I will sell this property & invest the amount received from it to purchase flat in Delhi & NCR.
2. My mother should sell it & pay income tax on it & then i will use that money to purchase flat in Delhi & NCR.
What would be the best way ?
Is there any other way we can go to sell property & save tax on it.
Asked 4 years ago in Property Law from Ghaziabad, Uttar Pradesh
if your mother gifts property to you it would attract 2%stamp duty . in addition registration charges would have to be paid . then if you sell property it would attract another 5%^stamp duty and registration charges .
best bet is for your mother to sell the property . if mother is holding on to it for number of years it would attract long term capital gains . then your mother can purchase flat in joint names . you would be joint owner of flat .
ask your mother to sell the property and invest that amount in a property in delhi ncr in joint name
Advocate, New Delhi
Hi, you can sell the property directly through mother only.
1. If your mother gifts you the property then she will have to pay stamp duty @ 11% (as this is the rate prevailing in Rajasthan) in addition to registration charges. After you sell it you will be required to pay stamp duty and registration charges. So gift does not make a sense.
2. Your mother should sell it and then the sale proceeds can be given to you.
Thanks to your valuable response.
still i have some doubts, As per property law in India, stamp duty is paid by buyer not by seller. So if my mother gifts it to me and pay stamp duty and registration fee on it and after that i sell that property and reinvest that amount to buy another property to save income tax on it. Is this the right way ? or
if my mother sell that property(to somebody else , not to me ) and because of that property is having more than 3 years, she pay long term capital gain tax on it. Can i use that amount and purchase property instead of joint owner of new property with my mother.
Asked 4 years ago
1)the reason we advised against gift deed is because of high stamp duty / registration charges . later if you sell it additional stamp duty is payable
2) your mother selling property and purchase in joint names joint is better bet . your mother can then bequeath property to you under will . . you must be aware for will no stamp duty is payable . registration is optional .
3) if on other hand gives you sale proceeds on sale of property she would have to pay substantial taxes . hence it is in your mother interest to reinvest sale proceeds