Dear Sir, My parents and an uncle (father's brother) had jointly purchased a vacant land two years ago. My parents and my uncle are NRIs and have no source of income in India. My mother is a housewife. My father and my uncle work for private businesses in the gulf. The said land was bought using remittances from abroad through cheques drawn from NRI/NRE accounts and partly through cash. The land was bought in my mother's and uncle's name. I recently received a letter from the income tax department seeking my mother's PAN and if she had filed income returns for the year in which the said land was bought. My mother has never filed any ITR as she doesn't stay here, and has no income source of her own. Could you please let me know what should I respond to the I-T department. Also, please let me know if there is any tax to be paid on the above mentioned land.
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Consult a CA and reply to notice
2) mention that land was bought in joint names out of money gifted by your father to mother
3) your mother ought to file income tax returns if her income exceeded taxable limit
4) sake consideration must have flown from your mother account and it should be reflected in her income tax returns
My mother does not have any income. And the money for the payment of the land amount was taken from my father's and uncle's NRI accounts, not from my mother's.
In reply mention that no part of consideration was paid by her
2) that she is a house wife with no source of income
3) that husband had ought of natural love and affection bought 50 per cent share in property in her name
4) get reply vetted by your CA
As per Income Tax Act, if an individual owns more than 1 property then, the first property can be assumed to be self occupied, and the tax on the same is NIL.
However for the 2nd property, and onwards, you need to either declare the rent received (if property put on rent) or declare the deemed rent received even if the property is lying vacant or if the property is occupied by your family members. Hence you will need to file your tax returns and declare the deemed rental income and pay taxes if applicable.
There is a specified computation, to calculate the annual value of a property or the deemed rental income chargeable to tax for which it is advisable you appoint a qualified and experienced NRI Tax Consultant for your tax matters in India.
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My mother does not have any income. And the money for the payment of the land amount was taken from my father's and uncle's NRI accounts, not from my mother's.
Though your mother was not earning but the property was bought on her name hence she is liable give reply to the notice received.
If you have not been compliant with the law and have not been filing your tax returns or have unpaid tax liabilities, it is best advised to contact a qualified and experienced NRI Tax Consultant immediately. Once you have updated the consultant of the details, they will best be able to advise you on the way forward and clear your dues and tax files of liabilities.
It is better no to cry over the spilt milk and concentrate on the milk available in the cup. Hence whichever best possible way to clear and update your previous tax compliance, it is advisable to put things in order from now onward.