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NRIs who want to sell their Indian houses are generally confused about the tax implications. This article discusses how much tax is payable and how much TDS is deductible when NRIs sell property in India.  How are capital gains from property sales taxed to NRI?
An NRI who wants to sell residential property in India must pay Capital Gains Tax. The tax payable on capital gains depends on whether the gain is short-term or long-term. When a house property is sold after 2 years (reduced from 3 years to 2 years in Budget 2017), there is a long-term capital gain (LTCG). There is a short-term capital gain (STCG) if it's held for less than 2 years. In the case of inheritance, NRIs face tax implications as well. How much tax is payable For NRIs, LTCG is taxed at 20%, while STCG is taxed at the applicable income tax slab rates based on total income taxable in India. TDS deductible When NRIs sell property, a TDS of 30% is applicable if the property is sold within two years from the date of purchase. Similarly, a TDS of 20% is applicable if the house property is sold after 2 years. NRIs can claim exemptions under Sections 54 and 54EC on LTCG from the sale of residential property in India. Exemption Under Section 54 It's available when NRIs make a long-term capital gain on the sale of their house property. The house may be self-occupied or rented. Please remember that you only need to invest the amount of capital gains, not the entire sale receipt. Of course, the cost of the new property may be greater than the amount of capital gains. However, your exemption will be limited to the total capital gain on the sale. You can also buy this property 1 year before the sale/2 years after the sale of your property. You may also invest the gains in the construction of a new house property, but the construction of that property must be completed within 3 years from the date of sale. Also, to claim this exemption, the 2014-15 Budget clarified that only ONE residential house property can be purchased or constructed with capital gains. In addition, starting from the assessment year 2015-16 (or fiscal year 2014-15), this new house property must be located in India. The exemption under section 54 will not be available for properties purchased or built outside of India. (Remember that you can't claim this exemption if you sell this new house property within 3 years from its purchase). Exemption Under Section 54F It's available when there is a long-term capital gain from selling any capital asset other than a residential house property. To qualify for this exemption, the NRI must construct one house property within 3 years of the date of transfer or purchase one house property within 1 year from the date of transfer of the capital asset. Also, this new house property must be in India and can't be sold within 3 years of purchase or construction. Also, apart from the new house, the NRI shouldn't own more than one house property, nor should the NRI purchase within 2 years or construct within 3 years any other residential house. In this case, the NRI must invest the entire sale receipt. Capital gains are fully exempt If the entire sale receipt is invested. If not, the exemption is allowed proportionately. Exemption under section 54 EC You can save the tax on your LTCG by investing them in certain bonds. Bonds issued by the Rural Electrification Corporation (REC) or the National Highway Authority of India (NHAI) have been specified for this purpose. These are redeemable after 5 years (3 years before 2018) and must not be sold before 5 years (3 years before 2018) from the date of sale of the house property. It's important to note that you cannot deduct this investment under any other circumstances. You have 6 months to invest in these bonds. However, to claim this exemption, you must invest before the return filing date. In a financial year, you can invest a maximum of Rs 50 lakhs in these bonds as per the 2014 Budget. To avoid TDS on capital gains, the NRI must make these investments and provide relevant proof to the buyer. The NRI can claim a refund for excess TDS deducted when filing their return. About PropertyAngel PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore.
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Do you own a building but don't want to worry about its day-to-day management? Work with a property management company, and you'll always reap the benefits. Having a team to handle maintenance, rent collection, upgrades, and other tasks will ultimately save you time and money. In this guide, we explain the core benefits of property management services.  Tenant Screening
Property management companies help landlords with tenant screening by conducting thorough background checks, credit checks, and employment verification on potential tenants. These checks analyse a tenant's financial stability, rental history, criminal background, etc. These property management services help landlords avoid potential issues with tenants like late rent payments, property damage, or evictions. It also ensures that the property is occupied by responsible and reliable tenants who will pay on-time rent and take good care of it, which is critical for maintaining the property's value. Rent Collection For landlords, collecting rent can be time-consuming and stressful, especially if tenants are late with payments or fail to pay. As part of their property management services, companies handle rent collection on behalf of the landlord. They usually have in-built systems to collect rent on time and deal with late or missed payments quickly. Property management companies make sure that landlords receive their rental income on time. Thus, it helps landlords avoid financial issues like late mortgage payments or missed bills and help them maintain a positive cash flow. Property Maintenance Property maintenance includes both regular maintenance tasks like cleaning and landscaping, as well as repairs and maintenance due to wear and tear or damage. Typically, property management companies have a network of reliable contractors and vendors who can perform maintenance tasks and repairs as needed. Additionally, they also conduct regular inspections of the property to identify and address any maintenance issues beforehand to help prevent larger and more costly repairs in the future. Thus, their property management services maintain the property in good condition, which keeps tenants happy and satisfied with their rental experience. Tenant Relations As a landlord, maintaining positive relationships with tenants is critical to make sure they're satisfied with their rental experience. Property management companies help landlords maintain positive tenant relations by acting as the second-landlord. Their property management services offer timely responses to tenant inquiries and provide assistance when needed. Besides, management companies also handle any issues that arise between tenants, like noise complaints, disputes over shared spaces, etc. Therefore, they make tenants sign a rental agreement to make sure all tenants adhere to the same rules and regulations. Marketing and Advertising Effective rental property marketing is key to attracting reliable tenants and maintaining a low vacancy rate. Best property management companies in Bangalore have experience creating effective marketing campaigns and use multiple platforms to promote their properties, including the company website, social media, and real estate portals. Additionally, their property management services help landlords set the right rental price for the property based on market trends, location, and other factors. Setting the right rental price is important in order to attract reliable tenants. Legal Compliance Landlords must follow local laws and regulations when dealing with tenants. Property management companies make sure landlords are compliant with all laws and regulations. They typically have experience and knowledge of the local laws and regulations that apply to rental properties, which can help landlords navigate complex legal issues. Similarly, they help landlords draft rental agreements that abide by all applicable laws and regulations. In addition, their property management services handle any legal disputes that arise between landlords and tenants. They also represent the landlord in court during the legal process if necessary. Financial Management Property management companies help landlords manage financial aspects by collecting rent from tenants, paying bills and expenses on time, handling disputes related to security deposits, etc. In addition, their property management services include providing monthly financial statements and year-end tax statements. This helps landlords understand the financial performance of their rental property and make informed decisions about future investments. Also, it saves them time and helps them avoid the stress associated with managing finances on their own. Peace of Mind Property management services help landlords rest easy knowing that their rental property is being professionally managed and that their tenants are being taken care of. Therefore, landlords can focus on other aspects of life, such as work or family, without worrying about the day-to-day management of their rental property. This can improve their overall quality of life and reduce stress and anxiety associated with rental property management. About PropertyAngel PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore. Post-pandemic, there has been a significant increase in demand for housing, with homebuyers showing a renewed interest in real estate. Reports suggest that India's real estate market is expected to exceed Rs.13 lakh crore by 2023, including both residential and commercial properties. This growth is mainly driven by factors like rising population, increased wealth, and rapid urbanization. The commercial sector is also playing a big role in driving the growth of the real estate industry, with factors like the expansion of commercial operations, improvement of the labour market, and rising income levels contributing to the demand for commercial properties.  What will drive the growth of the real estate market in 2023?
Demand for bigger living spaces has increased The preferences of homebuyers have shifted immensely due to the COVID-19 pandemic, with people now looking for bigger living spaces. In 2023, we can expect this trend to continue. Real estate and residential assets have become very important since the outbreak of the pandemic. The luxury industry is experiencing a surge in demand, reflecting a consumer mindset that values experience over other aspects of life. Increased interest from NRIs and HNIs The rise of the dollar against the Indian rupee and attractive investment opportunities have caught the attention of Non-Resident Indians (NRIs) in Indian real estate. Wealthy Indian consumers are interested in investing in luxury properties across the country, especially in their hometowns, to maintain an emotional connection with their home country. In the future, NRI investments are expected to continue to flow into the market and make up a significant portion of the demand for luxury residential and prime commercial properties, with Bangalore, Hyderabad, and Mumbai being the most popular destinations for investment. Higher demand for homeownership due to consumer sentiment The release of pent-up demand, along with the growing interest of millennials in the Indian real estate market, is positively contributing to the sentiment towards homeownership. This trend is expected to strengthen in the coming year, thanks to increasing income levels and the recognition of real estate as a dependable asset class. High demand for leasing space The demand for leased spaces is expected to increase, especially from IT and retail companies. Several large tech companies have already made commitments to expensive office leases. The warehousing industry is expected to continue to grow rapidly as e-commerce and third-party logistics companies continue to provide financial support. Also, investments in data centres are expected to increase, contributing to the already surging demand and making commercial properties a strong asset class. The rise of Prop-tech in real estate The year 2023 is expected to see an increase in the use of technology in the real estate industry. Proptech will continue to provide customers with a seamless experience when searching for, shortlisting, and finalising their homes. Proptech tools such as 3D tours, project and locality review videos, and comparative tools are becoming popular in the initial stages of the property search process. They are helping customers make informed decisions about shortlisting properties. Growing demand for smart homes The demand for IoT-enabled homes is increasing rapidly due to technological advancements and modern lifestyles. Frost and Sullivan predict that by 2025, the value of the Indian IoT market will reach US$9.28 billion as customers invest in connected home solutions for convenience and a hassle-free home experience. Also, the pandemic has accelerated the demand for smart appliances. Thus, smart home technology will continue to disrupt the real estate industry in 2023, which presents an excellent market opportunity for builders, designers, entrepreneurs, and investors. Smart home technology, such as IoT-enabled kitchen chimneys, ceiling fans, and water purifiers with AI monitoring, will drive efficiency and save energy, attracting conscious customers. Developers who offer houses with pre-fitted smart appliances will successfully cater to the premium segment of customers and enjoy high demand. Touchless interactions and whole-home automation will also play a significant role in providing convenience and comfort to customers, making smart home technology a desirable feature for prospective homebuyers. Rise of environment-friendly and sustainable real estate developments In recent years, the demand for green buildings has been rising. Developers and customers are interested in investing in eco-friendly and sustainable real estate developments that reduce carbon emissions, and it is becoming a business-critical requirement. Green buildings can save up to 50% of water and 30% of energy, and in the past decade, the top 6 cities in India have seen a 31% increase in green real estate assets, including Delhi-NCR, Mumbai, Pune, Hyderabad, Bangalore, and Chennai, according to a report by CBRE South Asia in 2022. Final Words Overall, the year 2023 has a promising outlook for real estate, as it remains a resilient as well as aspirational investment that offers both short and long-term gains. 2023 will be an exciting time for this sector, with an expanding economy, increased commercial operations, and rising income! About PropertyAngel PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore. The main goal of investing is to get the highest possible return. Real estate is a lucrative investment option and is growing rapidly year after year. Many millennials are interested in investing in real estate to either settle down or to get a good return on their investment. However, to make a profit, it is crucial to carefully analyse and invest in a developing location that is not yet on everyone's radar.  Chennai is one such location that offers promising investment opportunities and is considered one of the best metropolitan cities. Therefore, it's worth discussing why real estate investment in Chennai is more profitable than in other places.
Real estate investment in Chennai is considered one of the most secure and profitable investment options, and there are several factors that make it a lucrative choice. Chennai is recognised as India's "Detroit" due to its thriving automobile industry, and it has experienced consistent economic growth over the past decade, which has made it an attractive market for investors. Here are some reasons why investing in Chennai is a wise decision: High Rental Yields As the demand for properties in Chennai continues to rise, rental yields have also increased, making them incredibly higher than in other cities across India. Due to the significant rise in rental income, many individuals consider real estate investment in Chennai as a reliable source of regular income, which can provide long-term financial stability and benefits. Job Opportunities Due to its thriving industrial sector and abundant job opportunities, Chennai is an ideal location to invest in real estate. The salaries offered in this city are higher than the national average. Also, government headquarters, logistics, manufacturing, industrial services, and IT firms provide plenty of job opportunities. Therefore, real estate investment in Chennai is an attractive option for those seeking consistent income or future financial gain. High ROI potential The demand for residential properties in Chennai is high due to the influx of migrant workers and residents from other parts of India. Thus, it allows investors to make the most of their money and generate good returns in the future. The city's ongoing expansion and development plans make it a very attractive real estate investment destination. Residential properties in areas like ECR, OMR, Madhavaram, Ponamelle, and Arakkonam are in high demand and are trending residential properties in Chennai. Cost-effective real estate pricing Chennai's real estate market is cost-effective and affordable compared to other metropolitan cities like Mumbai. For example, the price of a sea-facing plot in Chennai is much lower than in Mumbai. This makes investing in Chennai's real estate market a once-in-a-lifetime opportunity for those looking to make a fortune. Additionally, various investment opportunities are available in and around Chennai's work culture and entertainment zones like Ambattur and Arakkonam, located close to industrial estates; OMR, Ponammalle, and Thiruvanmiyur, located close to the IT industry; and ECR, known as Chennai's getaway destination, etc. Strong economic growth Chennai, the capital of Tamil Nadu, has a strong and diverse economy with various industries like manufacturing, IT, logistics, and healthcare. This economic growth has led to increased demand for housing in the city, contributing to its high economic growth. Tamil Nadu is the country's second-largest GDP contributor, with more than 60% of its population living in the cities. It is ranked as India's most economically free state and one of the top three states in electricity generation. Affordable property prices As previously mentioned, property prices in Chennai are generally lower than those in other major Indian cities like Mumbai and Delhi, which makes it an attractive investment location. The outskirts and developing areas of Chennai are more affordable and have high growth potential. Once the construction is complete, investors can look for tenants, as there is a high demand for rental properties in Chennai. This high demand for rentals can result in positive rental yields for investors, making it an attractive option for those seeking long-term gains. Good infrastructure and connectivity Chennai has excellent transportation, healthcare, and education infrastructure, which makes it an attractive place for professionals and families to live. Again, each area has its own set of amenities, including prominent schools, hospitals, grocery stores, and shopping malls, providing convenience to residents. Chennai's affordable property prices, combined with its strong economic growth, result in a high potential for positive rental yields, making the city a desirable investment destination. The city is well-connected through various modes of transportation, including government buses, TNSTC, local trains, and the metro, which is not only convenient but also cost-effective. Besides, the government is investing heavily in infrastructure development to improve the city's overall quality of life, which further adds to its appeal. Overall, Chennai's growing population, strong economic growth, and competitive prices make it a desirable destination for real estate investment. About PropertyAngel PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore. Hyderabad, the capital city of Telangana, has received top rankings in indicators like GDP and is tagged as the most dynamic city globally according to the JLL City Momentum Index 2020. Hyderabad is close to major metropolitan cities like Bengaluru, Chennai, and Mumbai and benefits from excellent accessibility to markets. The investment industry highly values outstanding connectivity as it leads to upward trends in property prices because of its proximity to prime markets.  Here are some reasons contributing to the attractiveness of Hyderabad and its flourishing real estate market.
Emerging IT Hub Hyderabad has become an important place for the IT industry and therefore attracts a large number of working professionals to the region. This influx of people has created a high demand for real estate and investment opportunities. In the last six years, Hyderabad witnessed a drastic change and emerged as a new tech hub in India. The growth of the IT industry has given rise to various investment prospects, such as office spaces, residential and commercial properties, and co-living spaces. Due to the city's substantial consumer base, investing in real estate is considered a profitable option because the tech giants that drive the markets have a strong presence in the region. Open to New Opportunities Markets that can adapt to changes and embrace new trends will experience rapid growth. Hyderabad has shown its ability to adopt new technologies and trends, which is evident in the current market. The pandemic-induced digital trends have affected the markets, creating opportunities for data centre markets. The warehousing markets, which are in high demand due to the rise of e-commerce, are supplementing the commercial property market. The e-commerce industry has also adopted strategies like instant delivery, which has increased the need for warehousing. This has opened up opportunities for investors to invest in high-grade assets such as warehouses and data centres, which have elevated Hyderabad's position as a leading market. Investing in emerging markets that have the potential for development is wise, and Hyderabad has everything to make it an optimal investment location. Smart Government Initiatives The government initiatives have revitalised the sluggish markets in Hyderabad. Policies like 'Look East and North' and 'Integrated Township Policy' have been implemented to strategically disperse markets that were previously concentrated in certain areas of the city. These policies are now driving demand in outer regions and expanding them in a smart manner, which may result in a price increase of land in surrounding areas. To boost development, five IT parks have been approved in these corridors. Hyderabad is making efforts to avoid market saturation and create new investment opportunities, which is a desirable characteristic of any investment location. Fast Pace Infrastructure Development Infrastructure plays an important role in developing the real estate sector, and Hyderabad's Metro Rail Project and Outer Ring Road are connecting the key regions of the city. The Ring Road offers a convenient way to travel to any part of the city with minimal traffic congestion, which has propelled the real estate industry in areas like Adibatla, Ghatkesar, Kompally, and others, appreciating property prices. Thus, urban infrastructure has catalysed city development through enhanced connectivity. Diversified and Affordable Property Prices One of the unique features of the Hyderabad real estate market is the diversity of property prices and affordability. Hyderabad has relatively lower land prices than other metropolitan cities in India. The property prices in various localities in Hyderabad differ due to factors like development, connectivity, property availability, and proximity to the IT hub. For instance, in Narsingi, land rates range from Rs.2,000 - Rs.5000 to Rs.15,000 - Rs.20,000 per sq. ft. This allows a broad consumer base to invest in premium localities like Narsingi at an affordable price, further expanding the real estate market in Hyderabad. Final Words Hyderabad is transforming into a world of opportunities by expanding and scaling up markets. Because of its optimal location and climate, the city is attracting investors for various reasons. This led to the establishment of tech giants like Amazon and other profitable MNCs. So, if you're looking to invest in real estate, Hyderabad might just be the perfect destination! About PropertyAngel PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore. Has a golden era begun for real estate in Pune, following the largest launches and sales in 2022?11/5/2023 In India, the increase in office space revival, job opportunities, and work-from-home culture contributed to the growing housing demand in 2022. While many people in other cities returned to their hometowns during the lockdown, Pune saw a reverse migration. The city’s climate, vibrant job market, and education institutes are among the reasons why many people choose to live here. The real estate market in Pune has not only recovered, but recent reports indicate that housing is becoming a growing need in the city.  In 2022, Pune sold 85,000 units worth over 50,000 crores. Has the golden era begun? Pune Times Mirror talks to Mr. Rahul Ajmera, a young real estate developer and IIT Bombay alumnus, about the booming real estate market in Pune. It was a time of doomsday rhetoric and dismay around real estate when the Covid 19 pandemic hit in 2020. Several people said that work-from-home culture would destroy the real estate business. Nonetheless, real estate launches and sales reached an all-time high in 2022. What led to this? Since real estate is a structural sector of the economy, it cannot collapse easily. The restriction during the pandemic lockdown made people realise that a 1 or 2BHK wasn't spacious enough for a family of four. People who returned to their hometowns eventually returned because they realised that Tier III and IV towns don't have the health and social infrastructure that Pune has. Therefore, Real Estate Developers reduced the supply of 1BHK units and increased the supply of 2.5 / 3 BHK units. Why aren't prices falling in Pune if there's so much unsold inventory, as some real estate data analysts claim? The amount of unsold inventory in a city is one of the most deceptive statistics because it sometimes includes figures from abandoned and poorly planned projects. Because real estate is a niche market, these statistics should have no influence on a home buyer. Pune is a bustling city with plenty of job opportunities and developable land, so unlike Mumbai, property prices are still affordable. "When there's so much unsold inventory, why is it so hard to find ready-to-move-in homes in good projects? Supply and demand affect real estate values at the local level rather than the macro level. Depending on the surroundings, layout, and internal requirements of two projects, their pricing and unsold inventory in the same general area may be quite different." Popular social media influencers often talk about the financial benefits of renting over buying a home. How will this affect the future outlook? India has historically had poor rental yields, but this has had no impact on the real estate market. "Although living in a rented flat and investing the difference in EMI payments in a mutual fund SIP seems appealing, how practical is it to do so for 10 to 15 years?" Most people eventually want a stable life, so they marry, have children, and buy a house." What are the most important factors flat buyers should consider before making a decision? Buying a home is usually one of the most exciting things in life. However, choosing the right home can be difficult with so much information available and so many people around to influence us. Contrary to popular belief, more people do thorough research before buying a car or mobile than before buying a home. "Shouldn't they spend at least 15 to 20 days conducting the proper research before their home purchase, given that most homebuyers repay their mortgages over 15 to 20 years?" So, to help people make better home-buying decisions, we have created a fun-to-read Home Buyer's Guide." Many buyers are unaware of important details due to the new trend of non-refundable Eol/Token-based Pre-launches and end up booking a property that may not suit their actual needs. A home buyer's focus is diverted towards the project's grand amenities, discounts/offers, and promises of future development. "Also, buyers must find out about the exact location of the project, the developer's record and feedback from past customers, as well as the governing municipality." About PropertyAngel PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore. Buying a house is an important decision for an individual and often requires a huge investment. Therefore, it's crucial to weigh all options that can provide financial benefits to a person thinking about buying a property. If the individual is married, he must decide whether to buy the property in his own name or in co-ownership with his partner.  Here are some things to remember if you are married and considering buying a property.
Legal Ownership and Rights When you purchase a property with your spouse as co-owner, you must decide how to own it legally. In India, there are two options: joint tenancy and tenancy in common. In a joint tenancy, both parties have equal rights and ownership of the property. If one partner passes away, the other will automatically inherit the entire property. In contrast, tenancy in common allows each co-owner to own a specific percentage of the property. If one owner passes away, their share will go to their heirs, and the other co-owner will retain their ownership percentage. Stamp Duty Benefits When purchasing a house, stamp duty must be paid to the state government when a seller(s) registers a sale deed to transfer an immovable property (house) in favour of a buyer(s). Several states have reduced stamp duty rates for women as part of their social initiatives. Therefore, buying a property in co-ownership with your partner would lead to huge savings in stamp duty. Loan Eligibility Usually, prospective buyers require additional funds to buy a property, for which they approach banks/ financial institutions for availing loans. If a man makes a joint application with his working partner, there may be a significant increase in loan eligibility because the incomes of all the borrowers are taken into account. Thus, banks/financial institutions will consider both the partner's and husband's income when determining their eligibility for the loan facility. In contrast, an individual's net income determines his loan eligibility. Interest Rate Benefits Women are preferred applicants for lending institutions. Women borrowers/co-borrowers have a better chance of loan approval as data shows that loan defaults among women borrowers are much lower than among male borrowers. Also, several banks/ financial institutions offer women borrowers attractive terms, schemes, and lower interest rates for a home loan. Therefore, if a husband and partner obtain a home loan for a property in co-ownership, it would impact the EMIs and lead to significant savings in the amount repayable to the lender bank. Tax Implications Under the Income Tax Act 1961, home loan borrowers are eligible for tax benefits on both principal repayment and interest payment. Under Section 80C, each joint owner can claim a deduction of up to ₹1,50,000 for principal repayment as well as on registration and stamp duty charges. Furthermore, under Section 24, sub-section (b), they can claim a deduction for housing loan interest from house property income of up to ₹200,000. The provisions of the IT Act state that the income earned directly or indirectly by the partner from assets transferred to her will be combined with the husband's income. Thus, if the husband buys a house in his partner's name, with no monetary contribution from her, the rental income from this property may be treated as the husband's income and taxed at the applicable rate. However, if the partner works and has a separate income, and the property is purchased with an equal monetary contribution from both husband and partner, there may be tax benefits if the property is rented out. In such a case, the spouses can split the rental income equally. This may result in a lower tax slab to them according to the provisions of the Act. Final Words Overall, buying a property with your partner as a co-owner can have several implications. Women benefit more from stamp duty. Joint ownership also improves loan eligibility because the combined income of both spouses is considered when applying for a housing loan. However, it's also important to consider the potential tax implications if the partner has no independent income, as the partner's income may be combined with the husband's income. Another important thing to remember is that problems may arise if the marital relationship turns sour later. In such an event, the partner will be entitled to absolute ownership of her undivided share of the property purchased jointly. Also, at that point, prior consent of the other would be required to sell the co-owned property. Therefore, it's critical to weigh the benefits and drawbacks of co-owning a property with your spouse. About PropertyAngel PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore. |
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