If a son pays 60 lakhs for the purchase of house to his parents from his source and shown in IT returns, this amount is to be shown by father as income/gift/transfer within the family? Is he liable to pay IT on this amount?
1. Father is not liable to pay any type of Taxes, on any amount received from his Children, since this will be deemed to have been received as a Gift, unless the Children shows it otherwise, at times of legal dispute.
Father has to show this as lending from his son and can claim an exemption under income tax by showing some interest and can also secure his own property as his exclusive and not joint family property. The conditions between the parties on the treatment of this amount is crucial.(Lending for a period which must be repayable, or gift or contributions to his family with a right on property proportionate to the total expenditure etc.,)