How to avoid paying taxes on property transfer

[Smartknight3435]

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Smartknight3435
PARTICIPANT
April 26, 2025 at 5:07 pm

Let’s say I buy a property for 1 Cr in India. I have to pay 6% Registration charges and 5% GST. That’ll make 1.11 Cr. If I sell the property to someone, I have to register it under his name. Again he have to pay 6% Registration charges and any other applicable taxes and I have to pay capital gains taxes. As an alternative, If I buy a property worth 1 Cr under a company named XYZ Holdings and when I am selling it instead of registering the property onto the buyers name I can just transfer the ownership of the company to him and he will get the hold of the property without paying any taxes. What do you think?

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[Desibear1296]

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Desibear1296
PARTICIPANT
April 26, 2025 at 5:16 pm

Loophole

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[Preranapanther950]

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Preranapanther950
PARTICIPANT
April 26, 2025 at 5:21 pm

As far as I know, sale of immovable property doesn’t attract GST

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[Shikhaknight945]

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Shikhaknight945
PARTICIPANT
April 26, 2025 at 9:39 pm

If does

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[Silenthawk8217]

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Silenthawk8217
PARTICIPANT
April 26, 2025 at 10:01 pm

there are 3 taxes on property

GST on underconstruction
Stamp Duty
Income Tax – capital gain

if property is bought in company name GST will be charged if under construction and bought directly from builder. Not thereafter on resale.

Stamp Duty – this is the only thing you can save, but some states require paying stamp duty in these cases also.

Income Tax – can’t be saved, instead of capital gain on sale of property, it would be capital gain on sale of shares. Valuation is required, so can’t hide it.

So all in all only stamp duty benefit can be there. But there are other issues, like company is not entitled to section 54 exemption benefit. Company will not get housing loan.

So not a straightforward answer.

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