practical tax problem

 

Hi guys, My principal gave me a job to do….plz make some suggestions….

Mr. A, a client, located in NOIDA draws rs.3lak pm(as pure cash component of salary).His company provides him HRA of Rs.90K pm…moreover company is ready to bear the expenses of furniture to be provided at his residence.

Now practically speaking Rs.90k as a monthly amount cud b used 2 pay EMI for a decent flat in his locality.

In this regard Mr.A seeks to kno if there is anyway by which he can disguise the above transactions such that-

1. Maximum tax benefit is derived

2. He purchases a flat, simultaneously draws an HRA, and personally pay off the EMI

3. the company does not know his personal financial transactions.(ie. Purchase of flat)

Looking forward for a solution that more of tax planning rather than tax evasion……

Replies (8)

hey...interesting problem.....

will need expert advice....by some INCOME TAX SENIOr....just let me kno the answer too.....

can he register a company in his bro and sister in law's name...considering they seem to have a good relation...

but then it cud b a BENAMI transaction.....

@ pulin....hey...even i was thinking on that lines....but how to go about it is something intrsting....

i need a street smart answer rather than a bookish answer.....

AREY,

KOI TOH HELPING SENIORS....PLZ HELP KARO!!!!

EK INTERN KA DUKH EK DOOSRA INTERN HI SAMAJH SAKTA HEIN!!!!....;)....

the employee where he is working in order to claim HRA as tax exemption needs to provide the rental agreement with the Landlord. Incase if he buys his own flat whether he would be able to produce the rental agreement?

Purchasing a Flat and simultaneously claiming Exemption for HRA essentially amounts to Fraud which is not advisable in any case.

Hello,

 

I think there is no problem. He can purchase a flat in the name of his Wife/Father/Mother and can pay them Monthly rent. Just have to pay be check to them for a supporting document.

There is nothing like Benami transactions...

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