Selling property to a family member in India follows specific legal steps and considerations to ensure a smooth and legitimate transaction. Here’s how to sell a property to a family member:
Decide on whether to sell at market value, below market value, or as a gift. Selling below market value or gifting can have tax implications.
Clarify if payment will be in full upfront, through installments, or financed.
An Encumbrance Certificate (EC) proves that the property is free from legal or financial liabilities, such as unpaid loans or claims by others. So, get an EC.
Draft the sale agreement using NoBroker
. This agreement details the sale terms, price, payment schedule, and obligations of both parties.
Get it notarised. While not mandatory, it can provide an additional layer of authenticity and protection.
Stamp Duty is applicable even when selling to a family member. Rates vary by state but may be discounted for transfers between blood relatives.
Also, you are required to register the transfer of ownership in the government records.
Prepare a sale deed. It must have a description of the property, details of both parties, agreed sale price and payment receipt acknowledgment.
Execute the sale deed at the Sub-Registrar’s Office.
Pay stamp duty and registration fees directly at the sub-registrar’s office.
After the sale deed is registered, the buyer must apply for mutation at the local municipal office.
You must transfer utility services (electricity, water, gas) and property tax records to the new owner’s name.
Just sharing one important point. If the recipient isn’t covered under the exempt category (e.g., spouse, parents, children), transferring property below fair market value could attract gift tax. I hope you get an idea of how to sell a home to a family member.
Seek NoBroker Legal Expert’s Advice Before Selling Your Property to Family Members.Read more
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How to Sell a Property to a Family Member?
Tanusha
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7 months
2024-10-30T21:16:33+00:00 2024-10-30T21:16:34+00:00Comment
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