Purchase of property - purchase price lower than circle rate
This query is : Resolved
Quick Summary
18 March 2022
One of my close known to proposes to purchase a residential property In Haryana the sale price of which is around 15% LESS THAN the CIRCLE RATE of that property . To put it differently, , the Sale Price of the residential property is appx. Rs. 20 lakh LESS THAN THE CIRCLE RATE OF THAT PROPERTY.
KINDLY GUIDE TAKING INTO ACCOUNT EXISTING APPLICABLE LAW AND PROVISIONS OF INCOME TAX
1. WHETHER THERE WILL BE ANY ADDITIONAL LIABILITY OF INCOME TAX ON THE BUYER OF THE PROPERTY;
2. IF ANSWER TO THE ABOVE IS IN AFFIRMATIVE, HOW MUCH WILL BE THE LABILITY AND WHETHER THERE IS ANY WAY TO AVOID THAT LIABILITY.
KINDLY GUIDE TAKING INTO ACCOUNT EXISTING APPLICABLE LAW AND PROVISIONS OF INCOME TAX
1. WHETHER THERE WILL BE ANY ADDITIONAL LIABILITY OF INCOME TAX ON THE BUYER OF THE PROPERTY;
2. IF ANSWER TO THE ABOVE IS IN AFFIRMATIVE, HOW MUCH WILL BE THE LABILITY AND WHETHER THERE IS ANY WAY TO AVOID THAT LIABILITY.
19 March 2022
1 yes, tax payable on the difference amount considering it as other income.
2 Normal slab rate applicable. AO can seek valuer's valuation.
2 Normal slab rate applicable. AO can seek valuer's valuation.
20 March 2022
seetharaman sir,
I have been told that difference between the circle rate and sale value upto 10% is allowed and not treated as income. Kindly guide
I have been told that difference between the circle rate and sale value upto 10% is allowed and not treated as income. Kindly guide
21 March 2022
Yes you are right upto 10% it's allowed.
21 March 2022
sir,
will valuation report of the property would be required and if so who are such valuers????
will valuation report of the property would be required and if so who are such valuers????
21 March 2022
AO will have the list and appoint.
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