I want to purchase a property for my employee. The property will worth around Rs. 15 lacs.
My employee will live in the property but the property will remain in my name. I will have a contract made with the employee that he would pay me monthly installments against the property. I will not charge any interest from him neither there will be any fixed tenor to return the entire 15 lacs. I will also mention in the contract that I will transfer the property in his name whenever he will repay me the entire amount. The contract between me and my employee may run for 15 years.
Once he will have returned the entire amount, I will again invest the amount in a property in my name.
My question is that when my employee repays me a certain amount every month, will this amount be considered as my income and will this be taxable?
What will be the tax implications in this matter?
CAclubindia
