Taxes need to pay at the time of property purchase ...

Q: I am confused with this legal term .Kindly explain what are the taxes I should pay at the time of property purchase !!!

Neel Sharma, Gurgaon

23rd September 2014

Legal in Gurgaon

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Replies (3)

Kindly update your budget and location.
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Ved Verma, Noida

23rd September 2014

Comment

Hi Sir,
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Nishant Pathak, Gurgaon

1st October 2014

Hi Everyone,
I am planning to buy some residential property. I need some advice regarding lease hold & free hold property ...Kindly share some information .....

Preeti J, Greater Noida

23rd September 2014

Comment

Hi Preeti,
As per my knowledge, the terms ‘Freehold’ and ‘Leasehold’ are important legal terms used in connection with land property. Each has its own advantages and disadvantages. Understanding the difference between leasehold and freehold is one of the problems people come across when buying a house property.

Sai Kumar, Greater Noida

23rd September 2014

@ preeti,

Most of the property in India is freehold and transferred by registration of sale deed. In some specific areas such as Delhi, there are leasehold property and freehold property transaction. Therefore, before you plan to buy property or invest in real estate, you should know the difference between them.

Sunil Panday, Patna

23rd September 2014

Hi All,

In a leasehold property, technically the ownership remains with the concerned Authority or the government (as the case maybe). But this does not bar the individual owner (known as Lessee in this case) from selling or dealing with the leasehold property as he/she may deem fit.

Pranita Pandit, Greater Noida

23rd September 2014

@Preeti,

In a leasehold property, the Lessee has to basically execute a tripartite sub- lease deed executed between the Lessee, the Purchaser and the Lessor (which is the concerned Authority or the government). So what I understood is the basic difference between a leasehold property and the freehold property is the ‘ownership’ of the Property. That means you are taking a property( residential / commercial) for like 3-4 years by paying lump sum amount. Not like you are in rental basic.

Madhuparna, Gurgaon

23rd September 2014

Hi,

Whereas in a freehold property, the owner of the Property is the final owner of the Property and can sell/lease/mortgage the Property as he/she may deem fit. A freehold property is a property which gives full legal rights to the owners to live and use the property. Most of the property in India is freehold, which means that ownership is transferable.

Sonia, Gurgaon

23rd September 2014

Hi,

As per my knowledge, freehold property owner has the right to sell, transfer, renovate and repair the property. The freehold properties give more right and responsibility to the owner. The only disadvantage of this type of property is that the owner has to carry out repairs that may be required from time to time.

Nilufar, Gurgaon

24th September 2014

Hi,
In my point of view, you should you should pay the following taxes at the time of property purchase:-
1)TDS or tax deduction at source on amount exceeding Rs 50 lakhs for the purchase of immovable property excluding agricultural land. The TDS must be submitted in the name of the seller.
2) Stamp duty on registration.
3) Service Tax is applicable if the property is being purchased from the builder who conceived and constructed the project before offering possession to the buyer. If a ready-to-use property is purchased from the seller then service tax is not applicable.
4) VAT( Value added Tax) – if applicable on the state.

Nithin, Gurgaon

23rd September 2014

Comment

Hi,
May I know the procedure to register my property? Can't we sell any property without registration ?

Neel Sharma, Gurgaon

23rd September 2014

Hi Mr Sharma,

As per my knowledge, the original property document to be registered along with a copy is to be presented with the concerned Sub- Registrar by the Seller. Both Seller and the Purchaser are present before the concerned Sub- Registrar who admits the execution of the document. The sub- registrar after making the due inquiry registers the documents and returns the original document to the concerned party.

Karthik, Gurgaon

23rd September 2014

Hi Mr Neel,

Well i think you can not sell any property without proper registration. A registered document is the authenticity and guarantee of the ownership over the property. Neither should one sell a property without proper registered documents and neither should one purchase a property wherein the seller does not have registered document of his/her ownership in the Property.

Srishti, Gurgaon

23rd September 2014