Home > Money > Question
Need Expert Advice?Our Gurus Can Help

Loan woes and tax trouble: How can I help my brother?

T S Khurana

T S Khurana   |295 Answers  |Ask -

Tax Expert - Answered on Dec 03, 2024

A certified management accountant since 1993, T S Khurana is a fellow member of The Institute of Cost Accountants of India. His areas of expertise are income tax, specifically litigation cases, and GST.

Since the last 21 years, he has also been providing expert advice on financial matters, including investments and diversification of funds, and wealth building in the long term to his clients.
He believes that investment in real estate is the safest way for better returns and wealth generation over a period of time.

A former chairman of the Chandigarh Chapter of Institute of Cost Accountants of India, T S Khurana has also served as member of its technical committee.... more
sreekanta` Question by sreekanta` on Dec 02, 2024Hindi
Listen
Money

Respected Sir ji., My brother (59) in 2019 availed a loan of Rs 55 lakh for his daughter marriage and clearance of debt, due to some reason of cheat and fraud the marriage got broken, in order clear the loan with no other alternate he sold his property in 2020 for 90 lakh but received only 72 lakh, bcoz the purchaser bounced one cheque for Rs. 18 lakh. With available fund my brother cleared the loan upto 45 lakh in 2019/20. Due to problems of marriage n divorce n cheque procedure my bro could not submit yearly returns, Now he received notice from IT, kindly guide how to go ahead now.

Ans: 01. Please refer to the notice you received from IT department. Act accordingly.
02. Henceforth, file your Income Tax Returns on regular basis, whether income is more or less.
ADDITIONAL INPUT :
This is a case of WRONG PLANNING & UN-NECESSARILY AVOIDING TAX LIABILITY. Needs corrective measures.
03. Cheque bounce case should also be filed. Please note that Cheque bounce in case of sale of property may lead to cancellation of Sale Deed, if cheque numbers have been mentioned in the Registered Deed.
Most welcome for any further clarifications. Thanks.
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
Money

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |7548 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 23, 2024

Asked by Anonymous - May 20, 2024Hindi
Listen
Money
Hello Sir, My Brother is having home loan in Chola along with my father and mother has co applicant, due to accident my father expired and its affected business my brother is unable to pay the loan emi alone and i am helping him in repay the amount raye of interest increase from 14 to 16% asboer increase in RBI repro rate. is their a way to get loan under my name to Balance Transfer has he is not eligible to get new loan.
Ans: Navigating Loan Transfer Amidst Family Tragedy

Hello, I appreciate you reaching out during this challenging time for your family. Let's explore options for mitigating the burden of your brother's home loan while honoring your late father's legacy.

Understanding the Situation

Firstly, my heartfelt condolences on the loss of your father. Dealing with such a loss can be emotionally and financially taxing, especially when it affects ongoing financial commitments like loan repayments.

Assessing the Loan Situation

Your brother's inability to sustain the home loan EMIs alone, coupled with the increase in the interest rate, adds to the financial strain. It's commendable that you're stepping in to support him during this difficult period.

Exploring Loan Transfer Options

Considering your willingness to assist your brother, exploring the possibility of transferring the loan under your name is a viable option to alleviate the financial burden. Here's a step-by-step approach to navigate this process:

1. Loan Eligibility Assessment:

Begin by assessing your own eligibility for the loan, considering factors such as income, credit score, existing financial commitments, and repayment capacity. This will determine your suitability as a loan applicant.

2. Co-Applicant Consent:

Seek consent from your brother and mother, who are currently co-applicants on the loan, to transfer the loan under your name. Their cooperation and understanding are crucial in facilitating the transfer process.

3. Financial Documentation:

Gather all necessary financial documents, including income proofs, bank statements, and property documents, required for the loan transfer application. Ensure completeness and accuracy to expedite the process.

4. Loan Transfer Application:

Submit a formal application to the lending institution, expressing your intent to assume responsibility for the existing loan. Provide all relevant documentation and comply with any additional requirements stipulated by the lender.

5. Credit Assessment and Approval:

The lender will conduct a thorough credit assessment to evaluate your repayment capacity and assess the risk associated with the loan transfer. Timely submission of accurate documents can expedite the approval process.

6. Loan Repayment Plan:

Once the loan transfer is approved, devise a feasible repayment plan in consultation with your brother to ensure timely repayment of EMIs. Consider factors such as income stability, future financial goals, and contingency planning.

Potential Challenges and Considerations

While transferring the loan under your name offers relief to your brother, it's essential to be mindful of potential challenges and considerations:

Creditworthiness: Your eligibility for the loan transfer hinges on your creditworthiness and financial stability. Ensure that you meet the lender's criteria to avoid any setbacks.
Legal Formalities: The loan transfer process may entail legal formalities and documentation, which must be diligently adhered to for a smooth transition.
Financial Responsibility: Assuming the loan entails a significant financial responsibility. Evaluate your ability to manage the additional debt burden alongside your existing financial commitments.
Communication and Transparency: Maintain open communication with all stakeholders involved, including your family members and the lending institution. Transparency and clarity can facilitate a collaborative approach to resolving financial challenges.
Seeking Professional Guidance

As a Certified Financial Planner, I strongly advise seeking professional guidance from legal and financial experts to navigate the loan transfer process effectively. Their expertise can provide invaluable support in addressing complexities and ensuring compliance with regulatory requirements.

Conclusion

In conclusion, exploring the option of transferring the home loan under your name offers a potential solution to ease the financial burden on your family. With careful planning, cooperation, and professional assistance, you can navigate this challenging period and secure your family's financial well-being.

Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

..Read more

Latest Questions
Nayagam P

Nayagam P P  |4056 Answers  |Ask -

Career Counsellor - Answered on Jan 17, 2025

Kanchan

Kanchan Rai  |494 Answers  |Ask -

Relationships Expert, Mind Coach - Answered on Jan 17, 2025

Asked by Anonymous - Jan 17, 2025Hindi
Listen
Relationship
Then doctor asked her why she stopped and what I said, my wife said that he is asking for female staff and doctor said “I am a doctor and I am not having female staff and there is nothing male and female in doctor’s consultation” my wife got convinced and told me that we are continuing with this doctor and I also shaked my head as consent sign but not aware with the upcoming surprise and then she open her upper body part and doctor did the check up by pressing or whatever doctor does. And I was not ready for this So, I am still in trauma due to this, but I don’t want her to show her body to any male doctor. That picture comes again and again in my eyes. I don’t want to break my relation with wife, because we married 20 years before and we have 2 daughter and I love her too much. But she has disobeyed me and obeyed that doctor. I am in a trauma. What should I do to come out of this trauma. Please let me know.
Ans: To address your trauma, start by having an open and honest conversation with your wife about your feelings. Express your emotions calmly, without blame, so she can understand the depth of your discomfort and help you work through it. It's also crucial to recognize that trust and mutual respect are fundamental in any relationship. Your wife’s decision was likely driven by her need for medical care, not a desire to hurt or disobey you.

Consider seeking professional help for yourself. A therapist or counselor can provide a safe space for you to explore these feelings, work through the trauma, and develop strategies to cope with intrusive thoughts. They can also help you understand the importance of medical privacy and the necessity of certain procedures, which may ease your discomfort over time.

Additionally, you might want to explore couples counseling. This can help both of you navigate this situation together, rebuild trust, and strengthen your relationship. Remember, your goal is to maintain a loving and supportive partnership, and professional guidance can be instrumental in achieving that.

Your love for your wife and your desire to keep the relationship strong is evident. By addressing these feelings head-on and seeking support, you can move towards healing and maintaining the bond you cherish.

...Read more

Ramalingam

Ramalingam Kalirajan  |7548 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 17, 2025

Asked by Anonymous - Jan 17, 2025Hindi
Listen
Money
I'm 35 years old. I want to invest INR 65000 for retirement at 50 years old. My current expenses 65000 per month. Please guide me.
Ans: Retiring at 50 with your current lifestyle requires a carefully crafted investment strategy. Here’s a detailed guide tailored to your goal.

Step 1: Define Retirement Corpus Requirement
Current Monthly Expenses: Rs. 65,000.
Inflation Adjustment: At 6% inflation, your expenses will increase significantly by 50.
Retirement Corpus: The corpus must sustain you for at least 30+ years post-retirement.
Lifestyle Goals: Include travel, medical emergencies, and aspirational expenses in calculations.
Step 2: Asset Allocation Strategy
A balanced mix of equity and debt instruments can help grow your wealth steadily while minimizing risks.

1. Equity Mutual Funds (70% Allocation)
Why Equity? High growth potential to beat inflation over the long term.
Recommended Categories: Flexi-cap, mid-cap, and large-cap funds.
SIP/Investable Amount: Invest Rs. 45,500 monthly in equity mutual funds.
2. Debt Instruments (30% Allocation)
Why Debt? Stability and regular income during volatile markets.
Recommended Options: PPF, short-term debt mutual funds, or NPS (Tier I).
SIP/Investable Amount: Allocate Rs. 19,500 monthly.
Step 3: Include Inflation Protection
Inflation reduces the value of money significantly over time.
Your retirement corpus should grow faster than the inflation rate.
Equity exposure helps overcome inflation impacts effectively.
Step 4: Ensure Tax Efficiency
1. Equity Mutual Funds
Tax Rules: Long-term capital gains (LTCG) above Rs. 1.25 lakh taxed at 12.5%.
Action Plan: Use annual redemption to manage gains below taxable limits.
2. PPF and NPS
Tax Benefits: Both offer tax-saving benefits under Section 80C.
Lock-in Period: Ensure alignment with your retirement timeline.
Step 5: Emergency Fund Creation
Build an emergency fund equivalent to 12 months’ expenses (Rs. 7.8 lakh).
Park it in liquid funds or a high-yield savings account for quick access.
Step 6: Health and Risk Coverage
Health Insurance: Ensure adequate coverage to avoid depleting investments during medical emergencies.
Life Insurance: Use a term plan to secure your dependents until you achieve your retirement goal.
Step 7: Regular Portfolio Reviews
Review your portfolio every six months.
Rebalance based on performance, changing goals, and market conditions.
Seek advice from a Certified Financial Planner for optimized asset allocation.
Step 8: Additional Recommendations
Avoid Real Estate: Illiquid and high transaction costs make it unsuitable for your timeline.
Avoid Direct Investments: Opt for regular plans via mutual fund distributors guided by a CFP.
Diversify Investments: Explore international mutual funds for added growth.
Step 9: Incremental Contributions
Increase your SIP amount annually by 10-15% to align with income growth.
This ensures your corpus grows significantly over time.
Finally
Achieving financial independence by 50 is ambitious but achievable. Consistency in investments, inflation-adjusted growth, and regular reviews are critical. Focus on disciplined execution of the outlined plan for a secure and fulfilling retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

Close  

You haven't logged in yet. To ask a question, Please Log in below
Login

A verification OTP will be sent to this
Mobile Number / Email

Enter OTP
A 6 digit code has been sent to

Resend OTP in120seconds

Dear User, You have not registered yet. Please register by filling the fields below to get expert answers from our Gurus
Sign up

By signing up, you agree to our
Terms & Conditions and Privacy Policy

Already have an account?

Enter OTP
A 6 digit code has been sent to Mobile

Resend OTP in120seconds

x