Today we are talking about Budget 2018: Circle rate relief to boost realty sales, check out the Budget 2018: Circle rate relief to boost realty sales with complete details and accuracy At 9wiki.info.
Check down the table for Budget 2018: Circle rate relief to boost realty sales By 9wiki – The Encyclopedia We are always providing right details you can comment below if you found any irrelevant content of celeb.
NEW DELHI: With real estate prices dropping in many cities, property is sometimes sold at prices lower than the government-fixed circle rates.
To address the taxation problems that arise from this gap, the Budget has proposed tax relief for buyers and sellers by allowing property to be valued at up to 5% below circle rates for calculation of stamp duty and capital gains tax.
Circle rates, also known as ready reckoner or guideline value, have been revised upwards by most local governments over the last 15 years.
Circle rates were introduced to prevent tax evasion by declaring a lower sale price of the property on paper. Stamp duty is collected either on the sale proceeds or the circle rate value, whichever is higher.
But now that real estate prices are sliding in many cities such as Delhi-NCR, Bhopal, Kolkata, Lucknow and Jaipur, circle rates are higher than prevailing market rates.
So a person may sell immovable property lower than the circle rate, but the registrar office still charges stamp duty at the circle rate. Once the sale is completed, the income tax department deems the difference in the circle rate and sales value as unaccounted money, and taxes both the buyer and the seller.
To minimise hardships in genuine transactions, finance minister Arun Jaitley proposed that no adjustment shall be made when the circle rate value does not exceed 5% of the consideration.
Developers, however, say this is not enough and that stamp duty should be levied on real transaction value and not on the circle rate value.
Ramesh Nair, CEO and Country Head, JLL India, said the proposal would reduce difficulties for sellers. “With this, the government has recognised that there could be price variations within a zone or locality that has the same circle rate,” he said.