I have been living in the Gulf for the past 15 years and invested in overseas assets including real estate, securities and savings. I may return to India shortly. What are the tax implications in such a scenario? Please advise. Pratab Shetty, Sharjah
In the event of returning to India permanently, you can continue to retain foreign earnings, securities, savings, real estate, etc. when you had acquired overseas assets as an NRI. However, the income accruing from the assets will be taxable in India once you qualify as a resident in India. However, you can continue to enjoy the tax exemption for two years upon acquiring the status of ‘not ordinary resident’. When you file the income tax return in India, you are required to disclose all foreign bank accounts and assets, which is now mandatory.
A group of NRI investors prefer to jointly go for real estate development in Indian cities. What is the ideal entity that would benefit us? Vishal, Dubai
From the point of view of tax planning, partnership firm is the ideal option as you could distribute the profit to all the partners after making 30% income-tax by the firm without attracting any additional income-tax burden.
A few foreign companies have already entered India specialising in property management services. Moreover, you have tax advantages while renting your property. Normal deduction is available apart from 30 per cent deduction towards repairs, maintenance and collection charges, even if you have not incurred these expenditures. Moreover, complete deduction of interest payment for purchase of property is available from the rental income.
PE deals, both in size and nature, will increasingly turn closer to those seen in some developed markets over the next 10 years. And it may be no surprise if India sees over $40 billion PE investments in 2025. In a landmark order, the Madras high court had imposed a ban on registration of sale deeds concerning houses on unauthorised plots to prevent flooding and haphazard development in the state. The court further directed the inspector general of registration to circulate the order in this regard.
Author: V Nagarajan, is a business analyst covering Indian property market
Credits Gulf Today