Old property selling

Tax planning 1198 views 7 replies

samratsarkar

student

52 Points Joined August 2012

I am an NRI. My father is conservative retired senior citizen living in India. He is selling his primary residential house (built in 1980). He will renting thereafter. ( He is not going to buy any property or gold !)

The buyer is offering us 80% white money-documented (Bankers cheque) and 20% cash( not documented).

Total selling price of the house is almost 1 crore.

Is there an easy way to convert the 20% cash (20 lakhs) to white ?
Can we deposit the undocumented 20% cash into bank savings account ?
Is there going to be any headache for accepting the 20% cash from the buyer?

(We are ready to pay all Government Taxes and want to make the transaction simple, hassle free and clean.)

We are looking to for your advice. Thanks in advance.

Replies (7)

U S Sharma

glidor@gmail.com

21068 Points Joined January 2010

then ask the buyer to pay full 1 cr by banker's cheque,

try not to discuss such matters on public plateform, as this may bring some pain to yourself.

CA Guru M

B.com CA CS

1552 Points Joined October 2007

Agree with Sharma.

shyam sundar

Article Assisstant

183 Points Joined February 2010

you can deposit the entire sum of Rs.1crore in the bank and inform in your Income tax return that you have sold the property for one crore.

If the ITO asks why you received cash and not cheque, you can simply answer this is how the seller has paid you.

let the headache remain to seller.

manish sharma

ca final

110 Points Joined December 2010

I completely agree with shyam sundar you show Full Value Consideration of Rs.20lac.Your 1 crore is totally white & shown in your IT Return simply.

S Jananikrishna

Learner

219 Points Joined June 2012

Just ask the seller to pay through the chek itself so no headache ....otherwise declare that 20lacs in ur return..its better to declare full amount 1 crore..

samratsarkar

student

52 Points Joined August 2012

Thanks for all your responses.

1. Best Possible case: Take the whole amount in Bankers Check.

2. Is there any legal risk depositing the cash part in Bank savings account even if we are ready to file tax on the whole ammount ?

If yes then we will wait until we find a customer who will pay us whole amount in Bankers Check. Let me know your thoughts.

ANJALI AGARWAL

Student CA Final

22 Points Joined September 2012

A CLIENT IS FACING A CASH CRUNCH IN HIS PROPRIETORSHIP CONCERN AND HE DOES NOT HAVE ANY CAPITAL TO INTRODUCE FURTHER. HE WANTS TO SELL HIS OLD PROPERTY ,BUT THE TRANSACTION WILL TAKE TIME TO MATERIALISE, SO CAN HE TAKE A PART OF THE SALE CONSIDERATION IN ADVANCE IN CASH AND INVEST THE AMOUNT IN HIS PROPRIETORSHIP CONCERN?

PLEASE REPLY SOON