In this article we’ll get to know how a teen can buy property in India. Genz is more interested in investing and making their money grow for them. Stocks and crypto are of course fine but when it comes to the OG of assets, it has got to be buying a property, ain’t it true? 😎
But hold on, the question is how exactly can a kid buy a property in India?
Lads below the age of 18 can buy property in India in the most hassle free way possible. According to the Indian Majority Act of 1875, you can buy a property as a kid if your guardians sign the property contract for you.
If you are tired of looking around on the internet, we have got just the thing you need.
Well, we have done all the research so that you do not have to. Scroll away to learn about all the nitty gritty of purchasing a property as a kid 👇
When can a kid own their property?
As per the Transfer of Property Act 1882, kids can also become the owner when the property is passed on to them. The parents or legal guardian cannot cause any restrictions in the property transfer.
Well, a kid can become the sole owner of a property as soon as they reach the age of 18. Once you have hit this age bar or above you can be the legal owner of the property. Meaning you can take all the actions that you want to.
The Registration Act of 1908 restricts teens below 18 to sign off the property and take matters into their hands. A legal guardian is needed to do the deed and maintain the partial owner of the property until the childs becomes the legal owner and reaches the age of 18.
But can a kid buy the property?
Yes! If the property is presented as a gift to the kid, it is possible to purchase the property. In this way, the kids also become the legal owner of the house. How cool does this sound? 😉
Although the property would belong to the teen, you would not pass for taking care of the property. But right when you turn 18, you can do the due diligence and look after your asset.
If you’re a minor in India and you have some money saved up, you can use it to buy property in your name. But you can’t sign the papers yourself – your parents or guardians have to do it for you, just like we mentioned above.
They have to be really trustworthy and ethical when they sign those papers, because they’re making decisions for you. So make sure you choose someone who has your best interests at heart.
Now can the guardian sell off the kid’s property?
To answer it in simple words- no, the parents cannot sell their kid’s properties without a discussion with them. In fact, as per section 8(2) of the Hindu Minority and Guardianship Act, 1956, the guardians have to take the court’s permission before taking any action regarding the property.
The act clearly tells that the property can’t be put on rent, sold, exchanged or given as a gift without consulting with the court.
In case the guardians still take any action on the property the sale would not be considered if the teen appeals against it in court! Meaning, your property is yours. No one can play around with it without your permission.
The only con is that the kids can only appeal against the property sale in the court when or after they have turned 18.
How much tax is charged on the property owned by a kid?
The Indian Income Tax law states that kids can only hold up to two properties in India. No tax would be charged on the properties and the kids can play with the gains.
Any income from the gifted property that is being used by the kids or their families will not be taxable. But but but, if the guardians are looking after the property and rent it out, there’s a small tax percentage of 30% that would be applicable in this case.
How to register any property for a kid in 2023?
When your parents are buying a property, they can directly get it on their name as you might already know. Now, in case they wish to make the further transfer of the property to you, they can do so by putting your names on the papers. Yes, it’s that simple.
This rule applies to all the states of India except for Jammu and Kashmir.
What gets you rolling is the registration. You gotta do that for sure to be the legitimate owner of the property. The process is rather simple when you already have all the paper work sorted out.
The process starts with proving the property belongs to your parents, figuring out the worth of the property, paying off the fees for necessary paperwork and boom, you have gotten yourself a property. Where is the party though? 😉
Why should you have property as a child in India?
Although we think this question kind of answers for itself. Because who would not like to have an asset right? There is no such thing as too much investment so in case you have some good chunk of money stacked up, you should put in a very reliable asset.
And what’s better than property, right? Stocks might go up and go down, and crypto is quite volatile as we know but properties have shown sustainable growth, bagging the title of being one of the best investment ideas.
Conclusion
So folks, we hope you got all the answers related to how to buy a property as a kid in India.
That is about it for this blog!
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Till then, toodles guys 👋
