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Compared to the Western world where Retail participation in Equities is 50% or more, merely 5-6% of Indians invest in stocks in any form, directly / indirectly. The main investment stays in Real Estate. With Indian mindset it is quite pertinent to understand as to where one should put her money, if it is going to be in Real Estate. read more
At times a fairly good looking deal may turn sour. It is therefore pertinent to know, what all are involved In a real estate deal?
An agreement is signed and a token amount is paid. (Please note that cash payments for Real Estate is illegal). All payments have to be made in cheque / Neft etc.
What aspects should the deal encompass? The important parts of the deal are included in an Agreement to Sell (ATS).
This should clearly state the parties to the deal ie, the buyer & seller with their Address, Aadhar & Pan details.
Clear definition of the Property under consideration.
Details of the property’s acquisition, ie bought from etc, as also the Conveyance Deed/ Builder Buyer agreement and if it is on resale, all details of previous owners and recording of the same.
Govt approvals for buildings, building plan approval etc.
It gives out unambiguously, the Sale Consideration, ie the Price the Buyer has to pay to Seller. This is broken up in the Payment plan between the Buyer & the Seller, giving out the timeline.
In case of not meeting the payment obligations or on refusal of the Seller to get the property registered in the Buyer’s name, the legal aspect needs to be included. A normal deal cancellation entails forfeiture of the Advance amount paid, which is generally 10% of the total cost. Similar amount is applicable to both sides.
The ATS should include that there is no mortgage or encumberance on the property being sold. Legal jurisdiction in terms of property generally is based on the location of the property, ie the Court which has jurisdiction in that area.
How should one refund the money when a property deal is cancelled?
Technically, all deals are to be in Bank Transactions, so there must be communication in writing and / or mail, wrt the cancellation of the deal and Okayed by both parties. The refund money transfers must be to the same account from the payments were done. This avoids future litigations.
Financial and income tax consequences for a property deal which is called off or cancelled.
As per the income tax laws, if a property deal is cancelled, treatment of the token or other payment money has no benefit. It is taxed as an income for the individual having gains. If the buyer backs out from the deal, the seller has the right to forfeit the token money. The forfeited token or advance payment money, does not give the buyer any income tax benefit. It is treated as a capital loss under the tax laws. However, the advance money/earnest money that is forfeited, becomes an income of the seller in the year in which the deal is called off. Such forfeited earnest money is taxed under the head ‘income from other sources’ and not under the head ‘capital gains’, even though the income is received with respect to a capital asset.
Stamp duty paid -refund
Normally, for property transactions, the buyer pays stamp duty. It is generally a fixed amount or a percentage of the property’s market value. One also pays registration charges, for registration of the agreement. These rates are prerogative of the state govt and hence the rules for refund of stamp duty paid for property transactions, varies from state to state. In some states you are entitled to claim refund of the stamp duty, within a stipulated time frame, if the same has not been executed. The government generally deducts some percentage of the stamp duty.
While buying under-construction property, the Builder levies a GST on the agreement value, depending on the category the property falls, viz ‘affordable housing’ etc. In case of cancellation, of the under-construction property, the builder may agree to refund the booking amount and installments paid. However, even though the Builder may have charged you GST, he may not refund this amount, as he has to deposit the amount with the government. The builder is not entitled to claim any refund with respect to the GST, as he has already rendered services to you.
In case of resale to another buyer, by you, the sale price already includes GST. However, GST is included while calculating Capital Gains, as it has been capitalized and form part of the cost of acquisition. The capital gains will be taxable as long-term, if your holding period has been three years, or else, the profits, if any realised, will be taxed as short-term capital gains.
Real Estate investments are always in large monies. It is therefore, always better to consult an expert and take legal and financial advise for the same. Be safe, buy safely.
We have been getting inquiring about minor / low cost works with respect to house improvement like civil / wood / sanitary / flooring work etc. We do undertake such works, with min budget of around a lac, in NCR.
Anyone needing help could contact me
Reference Link:- https://colonelzbricklogic.blogspot.com/2014/10/worriylessly-upgrade-your-house-in-ncr.html
Most of us would have come across lucrative advertisements talking of 11-12% Guaranteed returns on your investments in Real Estate – mostly in Commercial Property like Offices / Shops etc. When Banks etc are giving you just 6-8% returns, why is The Builder ready to give so much more. Its simple Finance. read more
Due to growing population, every person in India needs some job or business, to make the survival better. Every person who needs a job has to sit at a place and businessman needs furniture for sitting purposes and for keeping the goods. In today’s time, there are several employees who work with the companies. And thus, the companies need more space in their office to make their employees sit for doing work keeping into account the less space utilization. So due to this space problem, modular furniture has been brought into the markets. Through this blog, we will tell you about the modular furniture, its advantages, and its disadvantages. And about how and what type of furniture is used in the offices to help you overcome the space issues.
Modular furniture is the type of furniture which is always pre-made or we can say it is ready-made furniture. It is very convenient and reliable in use. It can be folded and can be used as other forms of furniture also. In today’s time there are sofas that can be converted into beds. This is just a way to help you with the less space coverage. The modular furniture can be used according to the needs of the consumer. So, you can convert it the way you can taking into account the space constraints.
Storing things is a significant part of the office. There are many types of files and documents that need to be stored in the offices. You might also have important documents that need the safer and best place to be stored in the office. Offices also need tables and chairs to make the employees sit. There are times when some computer tables are also needed to place the computers, printers, and CPU. Sometimes you might need space to store the hard copies. If all the documents and files are placed in an unsystematic manner, it becomes difficult to find the document or file when needed. Sometimes the office also looks messy, which creates a bad impression on the employees and the visitors. Therefore, it is essential that the owner gives its employees a good environment to help them do their jobs properly and nicely.
There are a lot of options available when it comes to the modular office furniture according to the needs of the employees and the choices preferred by the office owners keeping into account their work and documents.
The most important furniture used in the offices is computer tables’ desks, which can be used in two ways. It can be used in placing the computers and its hardware devices and the second thing is the space to place the documents and files of the office sufficiently. There are many drawers available on this desk which is used for putting the different things. Like these computer tables, there are many shelves and cupboards available to put the files and many important documents. Modular furniture is always helpful if it is placed for office use. So, purchasing modular furniture brings you various benefits.