Can you please advise:
I am working in Dubai, and applied for a loan of 25 lakhs, I would like to use this funds to repay my personal loan (to relatives) and want to buy a land with left out money. I have two options – which one is good in terms of tax implication?
Send money to my mother's savings account directly
Open an NRE account in India and send money to this NRE account. Transfer funds online from the NRE Account to mother's Savings account. My mother can withdraw an amount of 30 Lk. (My mother has pan card and has pension account but didn't file any return, as her annual income is less than 60k/y). As this is a large amount transacting in her account, is there any tax implication? Will she get any tax notice? If yes, how to avoid this? Is this deposit considered as her income? Does she need to pay tax?
Can you please advise which is the best method?
Thanks Dheer for your quick response. I don't have any document for the relatives loan (those are all hand loans). Is income tax only ask question with regard to only source or even utilization of funds as well?