Hi Sreekanth, I am residing in US for the past 5+ years. My spouse is also working here in US. Last few years we (me and my spouse) made some investments in real estate. We bought plots (registered on our name) and last year we have purchased agricultural land and made the registration on my parents name (few acres on father and few on mothers name). I have transferred the money to my NRE and domestic accounts, and then transferred to my parents account (domestic) for the purchase. Given the current situation in India - demonetization, etc, i have few questions. Questions:
- As we made high value transactions (online, cheques, etc) to and from my parents accounts, will there be any issue in future w.r.t income tax etc. Or is it ok, as we have paid the taxes here in US and used the money to buy properties on parents name (direct family).
- will it be considered as Benami property even though we paid taxes here in states and the property is within family.
Hi, 1 - There can be some restrictions on who can purchase Agri land, depending on the State... 2 - Are your parents Tax Assessees? Your parents may get Compliance notice to which they can respond as 'income received as gifts' etc.. (if at all they get notice). Read: http://www.relakhs.com/non-filing-of-income-tax-return-notice-online-response/ http://www.relakhs.com/gift-income-tax-rules-detailed-guide/ 2 - It can not be called as Benami investment. What doesn’t fall under Benami Property?
- Property purchased in the name of spouse, relative, child, parents and paid through a declared source of income.
- Joint property with brother, sister, spouse, children which is purchased from a known source of income.
- Transaction involving a trustee and a beneficiary.
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