Builder false promises causing me worries

Tax queries 606 views 2 replies

Radhika Patel

Others

31 Points Joined May 2013

I bought 2 flats(1BHK) on a single floor(first).

Afterwards, the Builder approaches me and tells me that he wants to 1 of the flat.

He says that he will give me another one on the tenth floor.

I said OK.

Builder then transfers money in my bank and I sign over one of my flat to him.

I then buy the flat on the 10th floor. All the money transfers back to builders account.

Builder promises that I will not need to pay any tax on the money I received as I have just changed the flat.

But a friend of mine says that I will need to pay tax on it.

Please help clear this confusion.

I don't have money to pay the double tax.

Replies (2)

CA Suraj Lakhotia

IndigoLearn

4898 Points Joined May 2008

If you sold your flat at more than the purchase price, you will have to pay Capital Gains Tax.

Saving Tax in the above transaction

If you had purchased the first two flats three years prior to selling one flat back to the builder and purchased the one on tenth floor, capital gains would be exempt u/s 54.

Radhika Patel

Others

31 Points Joined May 2013

Originally posted by : CA Suraj Lakhotia
	If you sold your flat at more than the purchase price, you will have to pay Capital Gains Tax. Saving Tax in the above transaction If you had purchased the first two flats three years prior to selling one flat back to the builder and purchased the one on tenth floor, capital gains would be exempt u/s 54.

Thank you Sir for your reply. Yes, I have purchased the first two flats three years prior to selling one back. Actually I had bought the flats when the construction had just started.

Will "me owning more than one house" cause issues for me ? I mean :-