Dear Sir/Madam,
I am a CA Final student and working as well. One of my clients had consulted our office regarding tax planning. I would like to share their information and please guide them with expert opinion as I don't want my clients to suffer for my ignorance on tax laws. Following is the problem :-
Father has 1 residential property and his major son also has 1 residential property. Now they want to inter-change their properties.
Now, there are 2 possibilities for this.
1. They can transfer the property by giving adequate consideration (Stamp Duty Value), but Capital Gain tax would attract or they will have to purchase another property within 2 years.
2. the second possibility is Gift. By gifting the property to each other, they will be outside the purview of Section 56(2)(vi) as the gift is from relatives, and hence no Income from other sources. But will they have to pay stamp duty on both the properties?
Is ther any other way of tax planning so that no tax has to be paid or any other exemption can be claimed? Please guide them.
Thanks & Regards
Amoolya
CAclubindia
