Inherited Property? Here’s How To File ITR
Given that most Indians pass on their wealth and property to their legal heirs, it must for them to furnish the details about such assets when filling the Income Tax Return (ITR). If you have also inherited a property, here is a look at how you could file the ITR.
Things to know
*Even after the death of a homeowner, assets passed on from him/her to legal heirs, rather, the income generated from these assets must be shown by the legal heir. Section 159 of the Income-Tax Act suggests that the legal representative is liable to pay the tax that the original owner would have paid if he/she was alive.
*Legal heirs must pay only as much income tax as is his share in the assets bequeathed to him.
*The returns have to be filed in two parts- one where the income of the deceased is calculated and second, wherein after the death, the legal heir starts earning from these assets. Do remember that the pre-death returns that need to be filed should be done by the legal heir. Therefore, if the assesse died in February 2017, the returns have to be filed on his behalf by the heir and pay the tax from April 2016 to February 2017. Thereafter, the legal heir can file his own returns because the income borne out of the property is his alone.
How to file
Once you log on to https://incometaxindiaefiling.gov.in , go to the account of the deceased and add or register yourself as a ‘representative’. You would get this option under the ‘My Accounts’ Section. Note that this is a ‘New Request’ and that you must register yourself as a ‘Legal Heir’. You would be asked to proceed with details about the deceased such as his or her name, PAN and date of death. Keep a scanned copy of both the deceased and the yours handy as well as a copy of the death certificate and the registered will, family pension certificate as well or a letter issued by the bank that could confirm whether you are the nominee. All these copies have to be uploaded in a zip file not exceeding one megabyte (1MB) in size.
After submitting, a transaction ID and an acknowledgement would be generated. Once verified, the legal heir would be able to use all the services on behalf of the deceased through his own e-filing account. Thereafter, he must file the return on the deceased’s behalf. The legal heir would also have the option of choosing the PAN card of the deceased through a drop-down list. In the income-tax return do prefix ‘Late’ in the deceased’s name.
What to know about inheritance tax
Such a tax was abolished in 1986 therefore you are not liable to pay taxes on gifts on inheritance. But, you must remember the following:
*If the legal heir sells his inherited property, then capital gains tax comes into play. For this purpose, the cost of acquisition of the inherited property to the deceased shall be considered as the cost of acquisition by the heir. The period of holding by the deceased also counts.
*If the income of the heir including his inheritance exceeds Rs 50 lakh, then the heir is liable to provide details of all his assets and liabilities. Check Schedule AL.
*Income from capital gains tax is reported under Schedule Capital Gains in the ITR Forms.
*Looking for a tax refund? You would be required to fill details of your joint bank account for easy refund. If you do not have one with the deceased, then, the Centralized Processing Centre or CPC shall verify details and refund the amound in your name.
*If the heir has succeeded to the business of the deceased, then the heir also has to take up the loss incurred by the deceased which cannot exceed eight assesment years.
*Do remember to surrender the PAN card of the deceased after all filing and returns.
YOUNG WORKING MEN AND WOMEN ARE A MAJORITY OF HOME BUYERS NOWADAYS AT SILIGURI !!
Gone are the days when people used to exhaust their lifetime’s savings and buy homes in all-cash deals towards the dusk of their lives. Back then, taking a loan to finance property purchase was unheard of. By comparison, young working men and women today are a majority of home buyers every year. To become homeowners, people now don’t have to wait till they grow old; easy availability of home loans in the market has done the trick. If one has the means and the inclination to own a house, who wants to live in a rented accommodation, anyway? These were the thoughts that drove Sumit Shah, 29, an employee at a leading Bank at Siliguri, to book a 2BHK house in an upcoming housing complex. Shah patiently paid rent as well as the EMIs (equated monthly installments) till the time he did not get the possession. He argued with himself that he is saving a lot of money by availing of tax benefits on his home loan interest every time doubts started clouding his head over the viability of the purchase. He was a homeowner, Shah would remind himself. He would also remind himself of all the troubles his father Jamuna Lal Shah faced because his and his family had to shuttle between rented accommodations throughout his working career.
Homebuyers these days compare the beauty of being a young home owner with the trouble of living in rented houses throughout their lives. The conspicuous benefits are enough to invest in real estate, without giving much thought to the fact that the hurry is going to cost them dear. No doubt, the joy of living in your home is matchless. But, the flip side is that you have to be mentally prepared to spend a large part of your life, including the youth, under debt. Also, remember that the house still becomes yours only at the end of your 20- or 30-year loan tenure, when you have repaid every penny you owe your bank.
Another aspect to remember is that by the time you become an owner of, say, a 2-BHK unit in a highrise, you might start finding it increasingly difficult to live in an urban set-up. The traffic on the road and elevators in your building might give you discomfort. It is possible that as an older person you would want to have a home in a comparatively small city.
While it is good to own a house at any point in life, it is advisable that one thinks long-term before any investment that has so many financial and sentimental values attached. You should consider all the pros and cons of living in the place where you are buying the property, the features of the property itself, the amount that the property is going to cost you, and then take an informed call.
Visit www.siliguriproperties.com for the best properties at Siliguri or call 99330 22222
Siliguri now needs development of Good High End Residential Housing Complexes !!- GFS Realtors
The Focus everywhere has been on Affordable housing and we see that most of the Builders and developers across the country and rushing towards Launching affordable housing..Just reading and listening on news is making everyone run the rat race. And so is Siliguri..
What everyone is missing out is the dearth of high end residential accommodation in Siliguri. Over the years Siliguri has seen the development of periphery Location in terms of Mid Segment flats. But not many of the builders have tried their hands at developing high end Residential Complex in the periphery of the City.
What is interesting is the fact that success has been achieved in the mid segment flats in places like Champasari, Salbari, Matigara, Kadamtala, Salugara, etc and now builders are planning mid segment flats also in the heart of the city like Jyoti Nagar, Punjabi Para, Bhanu Nagar, Near Nirmala School, etc.
The result has been lot of options in that Segment but very few option in the High End Flat Segment. Siliguri was mostly concentrated for high end flats about 7-8 years back and saw the development of Residential Flats Like Club Town, Model Town, Green Valley, Uttorayon, Green Vista, etc and all turned out to be out and out successful.
Currently the Focus has shifted mostly to Mid Segment Flats. Due to Lack of development of good apartments people are slowly shifting and thinking about own house development and same has led to spurt in development in locations like “uttorayon”.
What needs to be understood is that Siliguri still has a high potential in High End Apartment Segment. Any new Project coming up in that Segment, if it can be built with good Vaastu orientation than it assures to be a great Success.
SBI has yesterday made Home loans above 75 Lakhs further Cheaper. The Prices in Siliguri are still around Rs. 3000 per Sq. ft and have full potential to touch the Rs. 4000 per Sq. Ft rate in the days to come. RERA would also ensure that only serious players with good track record and ability to deliver quality would sustain. GST Promises to make things more transparent.
Its time for Builders to think on the line of developing High End Residential Complex with latest Amenities both within the Town and also in the periphery. If People in the Mid Segment can meet the challenge of staying in the periphery than the people in the High end Segment can Surely do it..
Are the Siliguri Builders ready to take the opportunity.. Definitely Yes !!!
CA. Sanjay Goyal, GFS Realtors, Siliguri.
The Central Board of Direct Taxes (CBDT) on Thursday released the draft Income Computation and Disclosure Standard (ICDS) on real estate transactions for public consultation. The proposed ICDS will be applicable for determination of income from all forms of transactions in real estate, including land and buildings.
The draft ICDS doesn’t mandate obtaining all critical approvals for revenue recognition after the Real Estate (Regulation and Development) Act, 2016, (RERA), came into effect. It also proposes recognition of transferable development rights (TDR) at the fair value against fair market value or net book value as per the guidance note prepared by the Institute of Chartered Accountants of India (ICAI).
The transactions will include sale of plots of land (including long-term sale type leases) with or without any developments, development and sale of residential and commercial units, row houses, independent houses, with or without an undivided share in land. He added that acquisition, utilisation and transfer of development rights, redevelopment of existing buildings and structures and joint development agreements for any of the above activities will also be included.
Further, the proposed ICDS does away with the ceiling for revenue recognition based on stage of completion determined with reference to the project cost incurred. The draft is based on the guidance note issued on real estate transactions issued by ICAI with certain modifications as suggested by the government’s ICDS committee.
The specific ICDS on real estate transactions shall be a welcome move as it will bring clarity and certainty in application of provisions of ICDS and computation of taxable income to the sector. It can be expected that in near future ICDS will be issued for other specific sectors where application of ICDS III & IV on income is unclear.
The draft ICDS has made changes in five areas compared to the guidance note. These areas are definition of project and project cost, revenue recognition, application of percentage of completion method (POCM) for real estate projects and transferable development rights (TDRs).
Large private equity firms and non-banking finance companies are now getting interested in affordable housing
, thanks to the government’s recent incentives for this segment, including infrastructure status and speedy approvals.
So far, this segment was financed by funds with smaller ticket size which specialized only in affordable housing.The government has been pushing affordable housing in its bid to achieve ‘Housing For All by 2022’ and the efforts are showing with money flowing into this segment.
Kotak Realty Fund, that focused more on mid-income housing projects, is now evaluating the affordable home segment. “It is a large market to address. It is a business of low margins and fast turnaround. Hence the approvals need to come fast to convert land quickly into cash flow to make decent returns and the developer should be able to control costs well,” said Vikas Chimakurthy, senior ED, Kotak Realty Fund.
According to JLL India, builders of budget housing now have access to cheaper sources of funds, thanks to the newly-granted infrastructure status. As per statistics, the shortage of housing currently stands at around 1.87 crore homes, and nearly 95% of the shortage is in the affordable segment. Now, developers can and will focus more on launching projects in this segment, where the demand is maximum.
Some investors believe that private equity firms need to deploy a differentiated strategy while investing in affordable housing.
Typically, private equity firms would like to invest in affordable housing on ‘last-in first-out’ basis. Private equity funds can finance lastmile land aggregation and statutory payments for which construction finance is not an option. Private equity funds can take periodic exits through early surplus and the developer can bring in cheaper construction finance lenders with the project up and running.
Interestingly, equity flows have reduced in the residential sector in the past four-five years and made way for largely debt and structured instruments. The relative slowdown that this asset class has seen over the past three-four years has made investors somewhat conservative and made them turn to construction debt, last-mile funding and bundling receivables to ensure that their investments are protected against the lien of the asset.
In a country where slums sit cheek-by-jowl next to palatial luxury—including what’s been reported as the world’s most expensive private home—India’s unhoused may soon become a more potent economic growth driver.
Prime Minister Narendra Modi’s drive to bring homes to the country’s 1.3 billion people, rising incomes and the best affordability in two decades will unleash a $1.3 trillion wave of investment in housing over the next seven years, according to CLSA India Pvt.
The firm expects 60 million new homes to be built between 2018 and 2024, creating about 2 million jobs annually and giving a tailwind of as much as 75 basis points to India’s gross domestic product. The volume of social and affordable housing will rise almost 70% to 10.5 million annually by 2024, exceeding the 33% increase in the premium market.
“The housing sector is at a tipping point and will be the economy’s next big growth driver,” Mumbai-based analyst Mahesh Nandurkar and his colleagues wrote in a note last week. “The catalyst is the government’s big push for an ambitious housing program.”
Modi has been on a mission to expand affordable housing in Asia’s third-largest economy. In February, the government granted affordable-housing builders “infrastructure status,” making them eligible for state incentives, subsidies, tax benefits and institutional funding. In June 2015, it announced a “Housing for All” program which aims to construct 20 million homes across the country and in December it announced rebates and interest waivers for home loans under the program.
That’s not all that’s expected to fan demand. In the past five years, mortgage rates have dropped about 275 basis points to about 8.5%. Prices have remained stable while per-capita incomes have posted a compound annual growth rate of about 10%, according to the CLSA note.
While India’s real estate industry extended a slump after Modi’s sudden decision to ban 86% of the nation’s cash in November, affordable housing was growing the fastest before demonetization and the whole market has shown signs of snapping back.
The report predates the latest reform to regulate India’s notoriously unreliable property developers. Under laws that came into force 1 May 1 construction companies will have to use at least 70% of sale proceeds to complete residential projects, rather than funnel money to other jobs. Developers will also no longer be allowed to start pre-selling apartments before all building approvals are obtained. Those who don’t comply could face as many as three years in jail.
CLSA expects volume growth in new home construction to jump to a compound annual growth rate of about 8% over the next seven years from zero over the past five years.
So while luxury residences like 27-story “Antilia” owned by Reliance Industries Ltd chairman Mukesh D Ambani, and reported to worth anywhere from more than $400 million to over a $1 billion, have hogged Mumbai’s skyline, more affordable options may soon be springing up
The delay in possession of their homes has been the biggest concern for the buyers of the real estate properties. For many of the homebuyers, across locations and with almost the builders, the delay has extended to almost six years or more now, with no possession in sight. In the absence of a regulator and with no rules in place, the builder-buyer battle appeared one-sided.
Now, the real estate sector has got its own regulator from May 1, 2017, the date when the Real Estate (Regulation and Development) Act, 2016 (RERA) became effective in the entire country. Each state and UT will have its own Regulatory Authority (RA) which will frame regulations and rules according to the Act.
Let’s see what’s RERA has got in store to ensure timely possession of properties. In respect of the ongoing projects that have not received a completion certificate, the developers have to get them registered too. Once registered, they too will have to follow the rules, regulations of the state RA.