No tax on transfer of benami property
New Delhi. Transfer of immovable property declared under the black money disclosure scheme from benamidar to its real owner will not attract capital gains tax and one per cent TCS (Tax Collected at Source). The government has issued an official clarification in this regard.
He says that the real owner who bought the immovable property in the name of benamidar has already made the payment. Hence no amount will be paid to the benamidar. In such a situation, capital gain will not be charged on it. The special thing is that under this scheme, those who give details of benami immovable properties will not even be prosecuted. All they have to do is pay 45 per cent tax, cess and penalty to the government based on the current market value of that property.
The government has started the income declaration scheme on June 1 to bring out black money hidden within the country, which will run till September 30. However, during this period, those who expose benami immovable property will be able to get the said property in their name by September 30 next year. By doing this, the benamidar will not have to pay any capital gains tax or 1% TCS. A benamidar is a person in whose name another person buys property.
According to the Income Tax Department, during the period of Income Declaration Scheme 2016, whoever transfers benami property in the name of its real owner, in such cases capital gains tax and one percent TCS will not be levied on the benamidar. The department says that in such a case, the real owner (beneficial owner) has already paid for the purchase of the benami property and has declared its market value while furnishing his income statement.
The transfer of immovable property in the name of benamidar to the actual owner is only for regularization, therefore, the benamidar will neither have to pay 1% TCS nor pay capital gains tax on the same. It is noteworthy that under this scheme, those giving details of black money will have to deposit tax, cess and penalty in three installments by September 30 next.
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