11 February 2018
I intend to buy a flat in Virar. I am having only 25% of the funds for the same. I do not wish to opt for a home loan from bank. My paternal grand mother is willing to lend me the balance 75% amount by cheque. My query is whether it is advisable to borrow the balance amount from her and buy the flat in my single name.
Further do I need to disclose this in my ITR 1 or 2 and whether any registered or notarised documentation is required to be executed between us for the above borrowing transaction ( gift or loan) from my grand mother
12 February 2018
Gifts received by a person from his/her relatives who are lineal ascendants and lineal descendants do not attract income tax. Hence, maternal grandparents being lineal ascendant to that person, any gifts received from them shall not be taxed as income.
You can purchase the flat from the amount being borrowed from your grandmother. Since, you are receiving the amount by cheque no further documentation is required. But to be on the safer side, you can also enter into an agreement stating the terms of repayment and interest that you shall be paying to her.
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