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I have sold a plot in INDIA and want to gift the 50% of money to my brother who is working in US (San Francisco) and who want to purchase a house in US.

  1. What is the procedure to transferring the money to him. What declaration in have to give to the Bank (any Forms to fill)
  2. Will I have to pay Income Tax/Capital Gain Tax in India for the full amount or 50% of the amount.
  3. Rest of amount will be used to purchase property in India.

Please help and guide me.

Regards

V. Balasubramanian

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Will I have to pay Income Tax/Capital Gain Tax in India for the full amount or 50% of the amount.

Assuming you were the owner of the plot, you have to pay capital gains tax on the full amount. Current at 10% without indexation and 20% with indexation.

Rest of amount will be used to purchase property in India.

If you are re-investing the money into capital assets, you are not liable to pay Capital Gains for the amount invested. This is applicable only for first 2 houses. Consult a CA.

What is the procedure to transferring the money to him. What declaration in have to give to the Bank (any Forms to fill)

Under the liberalized remittance scheme you can transfer upto USD 1 Million per year. A CA certificate is required declaring the purpose and giving certificate that taxes are paid. Please contact your Bank or CA to guide further.

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