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Can I, an NRI, buy a flat in India in my mother's name? Will my mother have to pay the taxes even if she does not have any source of income? Are there any complications involved?

To be able to buy the house in your mother's name, the money must be transferred through normal banking channels into your mother's account in India. There will be no tax payable by her.

08 Dec 2008

Section 31 (1) of the Foreign Exchange Regulation Act 1973 (FERA) grants general permission to individuals of Indian origin whether they hold Indian passports or foreign ones. The general permission permits you to acquire, transfer, or dispose of residential properties (restricted to two houses) situated in India by way of gift from or to a relative who may be an Indian citizen or a person of Indian origin, whether resident in India or not.

To be able to buy the house in your mother's name, the money must be transferred through normal banking channels into your mother's account in India. She should buy the flat in her name from the money you remitted. Since the money you remit will be considered a gift to the mother, there will be no tax payable by her.



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